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  Category: Articles » Finance » Insurance » Article
 

What is Personal Injury Protection and Why Do I Need It?




By Keith Understrom

Purchasing an insurance policy is a real headache to almost everyone. It is invariably a very expensive item in the family budget. But it can be extremely costly in other ways; for instance, if the policy you bought does not cover what you thought it did.

Let's look at the main types of cover and try to throw a little light on the subject.

The best automobile insurance policies should include the following items: uninsured motorist coverage, collision coverage, personal property liability, bodily injury liability, comprehensive coverage and personal injury protection (PIP). Some of these elements are an imperative in the state while others are an option. Collision coverage pays for damages to a car or other vehicle when it is in collision with another car or other vehicle or non-vehicular object, even if the policyholder is at fault. Comprehensive insurance policies protect the policyholder in the unfortunate situation that their car or other vehicle is stolen, damaged or destroyed by malicious individuals, harmed by an act of nature or otherwise damaged. Both of these kinds of insurance are always optional and extremely costly.

Bodily injury and personal property liabilities are mandatory by all the states in the U.S.A in in some form. The states differ greatly, however, in the required minimum guaranteed payout. In the state of Alaska, for example, a driver is required to carry coverage that has a guaranteed minimum bodily injury payout of $100,000. But in Florida, a driver is only required to carry coverage worth $10,000.

Some parts of an auto insurance policy that could be optional are cover for the uninsured motorist and personal injury protection. The coverage for the uninsured motorist protects the policyholder in case he or she has an accident with somebody without insurance cover. It provides the insurance policies that should possibly have been supplied by the other person. If an accident should occur, personal injury protection pays for the medical expenses and other miscellaneous damages incurred by the policyholder and their passengers (or if the policyholder is an injured pedestrian). Carrying PIP is mandatory in: Colorado, Delaware, Florida, Hawaii, Kansas, Kentucky, Maryland, Massachusetts, Michigan, Minnesota, New Jersey, New York, North Dakota, Oregon and Utah.

Even if PIP is an option in your state, you may still want to contemplate purchasing the insurance policies. If an accident should occur, personal injury protection will pay around 80% (depending on insurance policies limits) of the costs of the policyholder and passengers. These costs include medical bills, lost wages and other miscellaneous expenses. PIP is a no-fault policy, so it will cover you and your passengers, even if the reason for claim was your fault.

PIP, sometimes referred to as Medical Payment Insurance or Medpay, is a no-fault insurance policies for a couple of reasons. Firstly, the fact that blame does not have to be determined saves time and therefore allows medical payments to get into the pockets of the injured parties as quickly as possible.

Secondly, it saves everybody from the cost of lawsuits being filed to prove responsibility for an accident and therefore who has responsibility for the bills. One time a PIP policy might allow for a lawsuit is if there is death or serious injury.

Before you purchase PIP, you would be wise to sort through your current policies and determine whether or not the insurance policies offered by PIP is duplicated anyplace else. As an example{/c] the cost of medical bills and lost wages may be recovered through existing health insurance cover. If this is the case, then you may need minimal PIP or none at all. Your driving skills or lack of them, will also help determine whether or not you need PIP. Do you carry passengers on a regular basis? While your health insurance might cover your own medical expenses, it won't cover those of your passengers (unless they are members of your family who share your health plan). Ask your regular passengers about their own health insurance policies and its limitations. If they are inadequately covered or not covered at all, you need PIP in order to keep them covered. That may not seem like such a fair deal, especially if you're the one driving an office car pool, but after all, the safety of any passengers in your vehicle is always going to be your responsibility.

If you reside in a state that requires PIP you will need to know the minimum amount of cover you must have because this has already been decided for you. If you live in a state where PIP is an option however, you might decide that you need the extra insurance policies anyway. How much insurance policies you need depends, to a large extent, on where you are in life. If you are middle-aged or older, have good health and liability insurance policies, then you will need minimal PIP insurance policies. On the other hand, if you are a youngster and still don't have much in the way of health and liability insurance, you will want to protect yourself, your family and your future by carrying as much insurance as you can afford. This is especially true if you have young children or if you constantly carry others in your car or other vehicle.

So whether you require personal injury protection insurance and at what level, is dependant on a number of factors: your personal circumstances, where you work and what you do, your health, where you live, your driving habits, and your level of existing cover. Regardless of your lifestyle however, you really do need to look into it with great care so that you can be secure in the knowledge that you are well and truly covered.
 
 
About the Author
Keith Understrom works in the insurance industry and runs a free insurance advice & information website as an information resource.

Article Source: http://www.simplysearch4it.com/article/34791.html
 
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