Does PIP Cover Uninsured Drivers?

Personal injury protection, or PIP, is an auto insurance coverage that pays for medical and rehabilitative expenses that result from an automobile accident. Depending on your state's laws, this coverage may also pay for loss of income, funeral and burial expenses and the completion of household tasks you cannot perform because of your auto accident-related injuries. PIP may cover certain uninsured people but does not cover uninsured drivers.

Covered Persons

PIP covers you and all licensed drivers in your household who are listed on your personal auto insurance policy, as well as other members of your household who occupy a covered vehicle at the time of the accident. This coverage also provides coverage for occupants of your vehicle who do not live in your household and do not have access to PIP coverage through another auto insurance policy. However, if non-resident vehicle occupants have access to other PIP coverage, your policy's PIP will not cover them.

Protection Against Uninsured Drivers

In states that require drivers to carry PIP coverage, PIP pays for injuries to you and covered occupants of your vehicle regardless of who caused the accident. If you are involved in a vehicle accident with a driver who in uninsured, your policy will cover your injury expenses, as well as injuries sustained by occupants of your vehicle who do not have other PIP coverage, up to your stated policy limits. However, it does not provide protection for other drivers or occupants of other vehicles, regardless of whether they carry auto insurance coverage.

Purpose of PIP

Insurance laws in most states are based on the concept of tort, and make the at-fault driver responsible for paying the injury-related expenses of other drivers and passengers after a motor vehicle accident. Because fault is not always clear, though, disagreements about fault can delay payment for injury expenses, which can cause injured drivers and passengers to put off treatment. Conversely, in a "no-fault" system, the driver's own PIP coverage pays for injury expenses regardless of fault, rather than forcing the driver to wait on a determination of fault. For this reason, PIP can allow covered drivers and passengers to seek treatment quickly.

Considerations

Although PIP may provide more timely payment for covered drivers and passengers, this type of auto insurance coverage has limitations. All 13 states that currently require drivers to carry PIP coverage follow a modified no-fault system. This means that PIP pays for economic damages, but not noneconomic damages such as pain and suffering. You may sue the at-fault driver for non-economic damages above a certain threshold; however, no-fault states typically limit the right to sue to cases involving serious injury or death.

References

• "CPCU 510: Fundamentals of Risk Management, Insurance and Professionalism"; AICPCU Society; 2003
• Allen Financial Insurance Group: No Fault Insurance