One of the most common mistakes people make when involved in a motor vehicle collision is assuming the at-fault driver’s insurance will pay for their medical bills as they receive treatment. With that said a common question is “why should my insurance company pay for my medical bills when I’m not at fault?” Before answering this question, we need to take a step back and look at Personal Injury Protection or PIP.
What is PIP?
PIP is no-fault insurance coverage which means regardless of who is at fault for a collision, you have access to it. If you have PIP coverage it also extends to the passengers in your car.
What does PIP cover?
PIP pays for your medical bills that are deemed reasonable, necessary and related to the motor vehicle collision. That is not all! PIP will also pay for a portion of lost wages that you incur after the first 14 days following the collision. There is still more! PIP also provides reimbursement for loss of essential services. This allows you to hire a non-family member for work you cannot do around the house such as yardwork or housekeeping.
Washington State law requires that insurance companies offer you a minimum of $10,000.00 in PIP coverage when selling you an insurance policy. If you do not accept PIP coverage on your policy, you must reject PIP by signing a waiver or checking a box. One advantage to PIP coverage is that there are no co-pays or deductibles that have to be met like with your health insurance. PIP is not available indefinitely. PIP is available for three years after the day of the collision or until you have used all of the coverage available.
Now back to the original question, “why should my insurance company pay for my medical bills when I’m not at fault?”
First, your PIP is primary insurance when it comes to paying medical bills as they are incurred, even if the at-fault driver has insurance. This means that the at-fault driver’s insurance will not pay for your medical treatment along the way. Additionally, this means your health insurance will not pay for your medical bills unless you show them that you do not have PIP coverage (the signed PIP rejection discussed above) or that your PIP coverage has run out.
The at-fault party’s insurance is not going to pay your medical bills as you treat. The at-fault party’s insurance will not pay anything until you are ready to settle your entire bodily injury claim. Note, your bodily injury claim is a separate from your property damage claim. When you settle your claim with the at-fault party’s insurance company, PIP must be paid back from the settlement. This is called subrogation or a right to recovery. If you hire an attorney, your insurance company is not paid back 100% of the PIP benefits they paid. This is because you are entitled to a reduction for the pro-rata share of your attorney’s fees and costs.
In sum, it is ideal to have PIP coverage on your policy. Why? Because it pays your medical bills regardless as to who is at fault for a collision, can provide you with loss wages and reimbursement for loss of essential services. PIP is there to help reduce the financial burden of being involved in a motor vehicle collision.