Personal injury protection (PIP) insurance is a type of supplemental auto insurance coverage that pays for your and your passengers' personal medical bills, funeral expenses, lost income and home health care after an auto accident. Unlike other types of protection, PIP coverage applies to any vehicular accident, regardless of fault.
In Texas, the only state-required auto insurance is 30/60/25 liability, which includes $30,000 of coverage if you injure one person, $60,000 if multiple injuries occur and $25,000 in property damage. Liability does not include your or your passengers' injuries, which is where PIP comes in. Texas drivers are not legally required to purchase PIP insurance, but all insurers must offer a minimum of $2,500 in coverage, although you can purchase more. If you do not want PIP, you must decline the coverage offer in writing under Texas law.
Medical Payments Versus PIP
Texas drivers have the option to purchase PIP or medical payments only, which is a more basic policy. With medical payment coverage, your insurer will pay for your or your passengers' medical and funeral bills after an accident, up to the amount of your chosen limit. Medical payments will be made even if you are injured by a pedestrian or bicyclist. A PIP policy includes medical payment coverage, plus an additional 80 percent of your lost income and home health care for the injured individual.
Types of PIP Coverage
If you or your passengers are injured in an accident, PIP will cover surgery, dental or optometry treatment, ambulance expenses, prescriptions and medical supplies such as prosthetic devices. If you or a passenger cannot work as a result of the accident, your lost wages will be reimbursed. If you cannot perform housework or need assistance in your home, PIP will cover the salary of a home health aide or caretaker. In the event of death, PIP will cover funeral expenses.
PIP and Uninsured Drivers
If you are involved in an auto accident, PIP insurance pays regardless of fault. If the other driver involved in the accident is uninsured, you may file a claim under your PIP policy to pay for your and your passengers' medical costs. However, PIP alone may not cover your bills if the other driver was at fault and does not have the state's minimum liability. To protect yourself in this scenario, consider purchasing uninsured or underinsured motorist protection.
PIP insurance may be your best option if you lack health insurance or if you frequently carpool, as all passengers in your vehicle will be covered after an accident. Before signing a PIP policy, check your health insurance policy to determine your benefits, which may overlap with PIP coverage.