Why everyone should have personal injury protection

All too frequently in our personal injury practice, we must inform our clients that their own automobile insurance policy lacks certain "no fault" coverage that could have benefited them greatly in their cases, without bringing any increase in their future insurance costs. Such insurance, which is known as Personal Injury Protection (PIP) and Medical Pay Insurance (Med Pay), offers significant benefits at relatively little cost.

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Personal Injury Protection (PIP) insurance, as the name suggests, is insurance intended to reimburse the injured victim for personal injury up to the limits of their PIP coverage, which, in Maryland, is usually $2,500. Specifically, PIP insurance reimburses the insured for medical expenses and lost wages suffered because of the accident. Med Pay provides similar coverage except Med Pay covers only medical expenses and not lost wages.

PIP and Med Pay insurance is "no fault," which means a person can claim PIP or Med Pay benefits whether or not they were at fault for the accident. By law, an insurance company cannot raise an insured's insurance premium because of a PIP or Med Pay claim.
Unfortunately, residents in many states, including Maryland, have the right to "waive" or reject PIP or Med Pay coverage. Many people do so because of the additional cost of carrying this insurance, only to later suffer the consequences of not having the insurance after being involved in an accident. In Maryland, such a waiver must be made by the insured in writing. You should consult with an attorney or reputable insurance agent before signing a waiver of PIP or Med Pay benefits.

The benefit of having PIP insurance is partly a matter of economics. Under the laws of many states, including Maryland, there is something called the "collateral source rule." Simply speaking, this means that the wrongdoer's insurance company, when asked to pay a claim, cannot claim that its obligation to pay is reduced because other (collateral) insurance has already paid all or part of the victim's claim.

For example, assume that a victim has incurred $2,500 in medical expenses in his case, and has PIP insurance with $2,500 of coverage. The victim's own PIP insurance will pay all of his medical expenses, leaving no medical bills unpaid at the time of settlement. The wrongdoer's insurance company, under the collateral source rule, cannot now claim at settlement that it owes the victim $0 for his medical expenses since those expenses have already been paid by the PIP insurance. Instead, the wrongdoer's insurance company must pay the victim the full $2,500 as if none of the bills had been paid, even though PIP may have paid them in full.

Equally important is the fact that any money paid by PIP or Med Pay does not have to be paid back to the PIP or Med Pay insurer after the wrongdoer's insurance company pays the medical expenses and lost wages at the end of the case. This means the victim will legally be entitled to collect twice for the medical expenses and/or lost wages up to the limits of the PIP or Med Pay coverage. his is difficult for some people to believe, but it is the law in many states.

Having PIP or Med Pay insurance also makes the process of arranging for medical treatment much easier, particularly in cases where the injured victim does not have health insurance. Some doctors will agree to treat a personal injury victim and wait to be paid until the end of the case. Other doctors, particularly specialists, however, refuse to wait for payment. What this means is that a person who lacks health, PIP or Med Pay insurance may be unable to obtain needed medical care if they cannot afford to pay the doctor's bill on the date of treatment.

If you do not have PIP or Med Pay insurance, we urge you to contact your insurance agent at once and add this important coverage to your automobile insurance policy. You will see that the annual cost for such coverage is usually less than $100 for $2,500 of coverage, while the benefits of having such coverage are significant.

If you have recently been involved in an accident and are interested in aggressive, diligent, and confident legal representation, please feel free to contact the lawyers at Belsky, Weinberg & Horowitz, L.L.C. for a free consultation.

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Why everyone should have personal injury protection