What Is Personal Injury Protection Insurance?

Personal Injury Protection was first introduced in 1970 as part of no-fault insurance, according to the Insurance Information Institute (III). The idea was to help people get medical care quickly after a car accident, without waiting for arguments about fault. It grew into a key part of auto insurance because it covers urgent needs such as medical bills, lost income, and other injury-related costs that follow an auto accident. 

Today, Personal Injury Protection insurance provides drivers with hassle-free, immediate medical reimbursement whenever necessary. Let’s explore PIP auto insurance coverage, how it works, what it covers, what it doesn’t, its cost, state requirements, and everything else you need to know.

What Is PIP Insurance?

Personal Injury Protection is a type of auto insurance that pays your medical bills and related costs after a car accident, no matter who caused it. This coverage steps in early because it’s designed to reduce delays and help you get the care you need right away.  

PIP also supports you when the injury affects your daily life. It can reimburse lost income, pay for essential household help, and cover long-term therapy or nursing services. These benefits make personal injury protection coverage different from standard liability insurance, which only pays for someone else’s injuries.  

Imagine you’re injured in an accident and need emergency care. You file a PIP claim, and your insurer pays the hospital, your follow-up treatments, and a portion of your missed wages. That’s how personal injury protection insurance works. It acts as your first layer of financial protection after a traffic collision or motor vehicle crash. 

How Does Personal Injury Protection (PIP) Work?

PIP steps in right after a car accident and pays your medical bills, part of your lost income, and other recovery costs before any other coverage. It’s designed to give you fast support so you can focus on recovery from injuries instead of fighting over fault or waiting on health insurance approvals. 

Here’s a real-world example of PIP coverage:  

Let’s say you’re in Michigan, and you get into a car accident and break your arm. Your ER visit, X-rays, follow-up appointments, and therapy add up to $28,000. Your Michigan PIP insurance includes a $50,000 medical limit. In this case, your insurer pays the full $28,000 for your treatment because it falls under your chosen limit. However, if your injuries had cost $75,000 instead, PIP would still cover $50,000. After that, either your health insurance or personal funds might have to step in to cover the remaining $25,000. That’s why it’s always important to choose the right limit for your PIP coverage to get fully protected. 

What Does Personal Injury Protection (PIP) Cover?

PIP helps you pay for the immediate and ongoing costs that come after a car accident, even when fault is unclear. It focuses on care, recovery, and support by covering essential expenses you’d otherwise pay out of pocket. 

Here’s what PIP coverage typically includes: 

• Medical bills for emergency care, hospital stays, surgery, and follow-up visits 
• Therapy and rehabilitation services 
• Nursing or in-home care related to your injury (e.g., housekeeping, childcare, yard work; up to $20 per day for up to 3 years) 
• Lost income when your injury keeps you from working (typically 85% of your income for up to 3 years) 
• Replacement household services, including childcare or cleaning 
• Funeral and death benefits 
• Transportation for medical appointments (including ambulance cost) 
• Coverage for passengers and family members in your vehicle 
• Protection as a pedestrian or cyclist if you’re injured in an accident

What Isn’t Covered by PIP Car Insurance Coverage?

Here’s what personal injury protection coverage usually does not include: 

• Damage to your vehicle or anyone else’s vehicle 
• Repairs or replacement after theft, vandalism, or fire 
• Medical costs for injuries you cause intentionally 
• Treatment related to driving under the influence 
• Property damage or legal liability toward other drivers 
• Pain and suffering unless state rules allow it through separate legal action 
• Injuries from riding a motorcycle, unless your state makes special exceptions 
• Costs that exceed your selected PIP limit 
• Claims filed too late or without required documentation

These exclusions are the reason drivers also rely on collision auto insurance, comprehensive coverage, and bodily injury liability coverage to complete their protection.  

Need affordable full coverage auto insurance or simply state-mandated coverage? Contact L.A. Insurance today. We ensure you, your vehicle, passengers, as well as others on the road, are financially protected with the right coverage. Call us at (800) 893-9393 or request a quote to buy same-day coverage with instant proof of insurance. 

Do You Need PIP If You Already Have Bodily Injury Liability?

Yes, if your state requires you to carry PIP coverage, you have to have it even if you already purchased Bodily Injury (BI), which is a component of liability auto insurance. 

Both these coverages protect completely different things. Bodily injury pays for someone else’s medical care when you cause an auto accident. PIP protects you by covering your medical bills, lost income, and recovery costs after you’re injured in an accident, no matter who was at fault.

Most no-fault states also require PIP by law, which means bodily injury alone is never enough to meet state insurance rules. 

The following table shows the major differences between these two coverages:

So, in short, yes, drivers need both to stay fully protected if their state requires. In many at-fault states, PIP isn’t required. Instead, they just need to carry liability auto insurance, which combines both bodily injury liability and property damage liability. 

What Are the Differences Between PIP and MedPay?

If your state or insurance company offers both PIP and Medical Payments Coverage (AKA MedPay), you might feel puzzled about which one covers what. Since both are actually designed for covering medical-related costs.

Here are the differences between PIP vs. MedPay to get you out of that confusion:

Learn more about different types of car insurance coverage so that you can make the best decision for your financial protection. 

States That Require Personal Injury Protection Auto Insurance

Some states make PIP mandatory. Others offer it as an add-on or let drivers opt out. State rules, limits, and opt-out options vary a lot, so treat these lists as a clear starting point and check your state page or your insurer for exact requirements. 

No-Fault States Where PIP Is Required by Law 

These states use a no-fault system and require drivers to carry PIP (showing the commonly cited minimum/typical requirement in brackets): 

• Florida ($10,000) 
• Hawaii (10,000)  
• Kansas ($4,500)  
• Kentucky ($10,000)  
• Massachusetts ($8,000)  
• Michigan (options from $0 up to unlimited, selectable levels) 
• Minnesota ($40,000) 
• New Jersey ($15,000) 
• New York ($50,000) 
• North Dakota ($30,000) 
• Pennsylvania ($5,000) 
• Utah ($3,000) 
• Delaware ($15,000 per person / $30,000 per accident) 
• Oregon (typically $15,000)  
• Puerto Rico (territory-level PIP requirement).

Please note that some states on this list use hybrid or choice no-fault systems (e.g., Pennsylvania, New Jersey, and Kentucky). That means PIP is required, but drivers may have different options for how their injury claims are handled after an accident.  

At-Fault States That Require PIP (or a PIP-style benefit)

A few at-fault states require a PIP-style benefit or make PIP available under specific rules. Commonly cited examples: 

• Arkansas 
• Delaware (hybrid insurance system) 
• Maryland (PIP or similar first-party benefits apply in some plans).  
• Oregon (has had mandatory elements or add-on PIP requirements in different forms).

At-Fault States Where PIP Is Optional

In some states, you can actually add PIP if you need. These are: 

• New Hampshire 
• South Dakota 
• Texas 
• Washington

What Is PIP Insurance in Michigan and How Much Does It Cover?

Michigan’s personal injury protection coverage is different from most states because drivers can choose how much medical coverage they want. After the 2020 reform, Michigan no longer requires everyone to carry unlimited medical PIP, but it still protects residents with some of the strongest first-party benefits in the country.  

PIP in Michigan pays for your medical bills, long-term therapy, in-home nursing care, lost income, and essential services when you’re injured in an accident. It also covers rehabilitation, transportation for medical visits, and survivor benefits after a fatal motor vehicle crash.  

Drivers can choose from several medical PIP limits, including: 

• Unlimited medical PIP 
• $250,000 
• $500,000 
• $50,000 (for qualifying Medicaid enrollees) 
• Opt out of PIP medical for Medicare Parts A and B enrollees 
• Exclusions for household members with qualifying health insurance

Each option affects how much your insurer pays when a car accident happens. For example, unlimited PIP can cover lifelong care after catastrophic injuries. Lower limits offer more affordable premiums. However, this may shift remaining costs to your health insurance once the limit is reached. According to Michigan Auto Law, unlimited medical benefit is the safest option of all. 

Learn more about Michigan auto insurance requirements.

How Much Does Personal Injury Protection (PIP) Coverage Cost?

PIP is usually one of the more affordable parts of your auto insurance policy. Many insurers estimate that it makes up roughly 15% to 20% of your total premium. National data also shows a wide price range. Some drivers pay as little as $5 a month, and others pay closer to $50, depending on their state. Annual averages shared by industry sources often fall between $50 and $200. 

Several factors influence how much your PIP coverage costs: 

• Your state’s insurance system and minimum PIP limits 
• The medical limit you choose, including unlimited options 
• Your driving record and claim history 
• Your vehicle type and location 
• Whether you have qualifying health insurance that reduces your PIP needs 
• Local medical costs and state regulations governing personal injury protection 

Here’s a table showing average PIP insurance costs by state (where required):

*Rate is subject to change based on individual driving history, claim history, chosen insurance provider, and other factors.  

Source: The Zebra | As of November 2025  

How to Pick the Right Amount of Personal Injury Protection Coverage?

Choosing the right PIP limit starts with understanding how much help you’d need after a car accident. Medical care can be very expensive, and recovery often affects your income, daily routine, and long-term health. The goal is simple. choose a limit that can realistically cover your medical bills, support your lost income, and protect you from large out-of-pocket costs if a serious motor vehicle injury happens. 

Here are a few things to consider when deciding your PIP Coverage amount: 

• Your current health insurance and how much it covers after an accident 
• Whether you can afford to miss work without strong lost wages protection 
• The cost of medical care in your state, especially in no-fault states 
• Whether your family depends on your income or daily help 
• The type of vehicle you drive and your typical commute 
• Your comfort level with higher or lower PIP coverage limits 
• Whether you want broad protection or a budget-friendly option

If you want stronger financial protection, choose higher limits or unlimited options, especially in places like Michigan. Pick moderate limits when you already have strong health coverage. The right choice is the one that keeps you confident that you’ll be covered for all injuries after an accident. 

Learn more: How much auto insurance coverage do I need?

Is Personal Injury Protection on Car Insurance Worth It?

Yes. PIP is not only a legal requirement in no-fault and some at-fault states, but also worth it for most drivers! It pays your medical bills, supports your lost income, and gives you fast help after a car accident without waiting for fault decisions. It also fills gaps that health insurance and liability insurance don’t cover. If you want predictable, immediate support during recovery, strong PIP coverage is one of the most reliable protections you can carry. 

PIP Insurance Coverage FAQs

What is a no-fault insurance state?  It’s a state where your own insurance company pays your medical bills and related costs after a car accident, regardless of who caused it. This system is designed to speed up treatment and reduce lawsuits. 

Do I have to pay the PIP deductible? 

Yes, you need to pay the deductible amount after a PIP claim. you’ll pay that amount before your personal injury protection benefits start. Many drivers choose lower deductibles for faster reimbursement.

Do you need PIP if you have health insurance coverage? 

Yes. Health insurance doesn’t replace PIP. PIP also covers lost income, essential services, and certain accident-related costs your health plan won’t pay for. 

Does health insurance cover injuries from automobile accidents? 

It usually does, but it won’t cover everything. Your PIP coverage pays first in no-fault states, and it handles extra benefits like wage loss and household help that health plans rarely include. 

What is the difference between uninsured motorist and personal injury protection? 

Uninsured motorist coverage protects you when another driver has no insurance and causes the accident. Personal injury protection protects you no matter who is at fault and pays for your medical bills, therapy, and lost wages right away.