Don’t be “penny wise and pound foolish” when it comes to your auto insurance. We do tons of auto accident work here and one of the biggest mistakes people make is regarding their Personal Injury Protection (or PIP) coverage. PIP coverage is there to pay for your medical bills and lost wages whether or not you were at fault in causing an accident. You can opt out of it, so some people don’t have it at all, while most people carry $2,500 in PIP coverage. But for just a few more bucks per premium period you can up that number to $10,000. And if you have ever been in an auto accident with even minimal injuries, you know that with just a few days off work, a couple of doctor’s visits and a few weeks of physical therapy, you can blow through $2,500 very easily.
Another advantage to higher PIP coverage is that, in MD, the PIP insurer has no right of subrogation. Subrogation is the term used when an insurer has the right to get back the money they paid to you, if you recover in a personal injury claim. When you’re not at fault in an accident, PIP insurers cannot ask for subrogation, but your health insurance company can. This means if your settlement is for $10,000 and your PIP covers you for $10,000, you can still recover $10,000. But if a health insurer paid for your medical bills, then that $10,000 is reduced by the amount that you owe them. So: 1) under no circumstances should you ever elect to have no PIP insurance; and 2) call your insurance agent and up that PIP coverage NOW to $10,000. DO IT!
I know this sounds like I am an insurance agent, but the truth is we have a “love/hate” relationship with insurers. When they provide for our clients as they have been paid to do, we love them. When they don’t, we pursue them vigorously to make sure they do the right thing.
Have a great day.
Steve Campen, Esq.