In Pennsylvania, lawmakers and insurance companies refer to personal injury coverage (PIP) as first-party benefit coverage or medical benefit coverage. To meet Pennsylvania’s legal requirements as an “elective no-fault” state, you must carry at least $5,000 in PIP coverage. PIP coverage provides financial compensation for your own medical bills, lost wages, and funeral expenses resulting from a car accident, regardless of whether you were at fault. Bankrate’s insurance editorial team breaks down everything you need to know about her PIP coverage in Pennsylvania to help you understand what coverage you need and what it protects you from.
What is PIP insurance?
Depending on your coverage choices, PIP coverage in Pennsylvania can help cover your medical bills, lost wages, and funeral expenses if you are involved in an accident. Pennsylvania is a no-fault state, so you can claim these benefits regardless of who caused the accident. PIP also provides compensation to your passengers or resident family members who are injured by another person’s vehicle or pedestrian.
Pennsylvania policyholders will not see the term “Personal Injury Coverage” on their policy declaration page. Instead, you will see the terms party benefits or medical expense benefits to describe what is traditionally called his PIP coverage.
How does Pennsylvania PIP work?
Pennsylvania’s PIP law requires insurance companies to provide at least $100,000 of medical benefit coverage. However, policyholders can select the $5,000 minimum option by completing a coverage selection form. If you meet the minimum requirements and are involved in an accident, your insurance can only claim up to $5,000 in medical expenses. Medical expenses of at least $5,000 do not include time-off compensation.
Depending on your insurance company, your medical expense benefit limit may exceed $100,000. In addition, you may add one or a combination of the following optional first-party benefits, subject to various limits:
- Income loss benefits: This option helps cover lost wages if you are unable to work after your application is approved. In most cases, 80% of your gross income will be covered up to your policy limits.
- Funeral expenses benefits: We will pay reasonable and necessary expenses for funerals and cremations.
- Accidental death benefit: Under this benefit, if a person involved in an accident dies as a result of their injuries within 24 months of the accident, the beneficiary receives the insurance money.
- Options to limit special medical benefit coverage: This option provides stronger coverage by offering more than $100,000, which is the maximum amount typically paid in a claim. Typically, this coverage has a lifetime limit of $1 million.
Does Pennsylvania require PIP?
Pennsylvania requires some form of medical benefit coverage for you and your passengers, up to a maximum of $5,000. It pays for medical expenses for you, your passengers, or anyone else covered by your policy, up to a maximum of $5,000, regardless of who was at fault for the accident. Many people believe that Pennsylvania is her PIP insurance state because of this requirement.
In addition to medical benefits, Pennsylvania also requires other minimum coverage types for drivers. This includes:
- Personal Injury Liability $15,000 per person
- $30,000 personal injury liability per accident
- $5,000 property damage liability per accident
Whether you buy PIP coverage or minimum liability, it’s important to remember that if you only buy minimum coverage, you’re likely increasing your risk of out-of-pocket costs. For example, if you purchase $5,000 of medical benefit coverage, this may not be enough to cover the costs of multiple injuries to you and your passengers. Additionally, purchasing the bare minimum will not provide additional financial protection if you lose your job due to your injury.
Drivers looking for cheap car insurance in Pennsylvania may consider choosing limited torts, as premiums tend to be significantly lower, but before doing so, they must be licensed. It may be beneficial to consult your agent.
How much does PIP cost in Pennsylvania?
The average cost of auto insurance in Pennsylvania in 2024 is $514 per year for minimum coverage and $2,450 per year for full coverage. Like any other coverage you choose on your auto insurance policy, the cost of PIP depends on the purchase price. Medical payments must be at least $5,000, but you can increase this amount.
Car insurance rates, including coverage options, are determined by a variety of factors. These factors include age, zip code, vehicle, driving history, and several other personal factors. If you are interested in adding higher PIP coverage amounts to your policy, you can work with a licensed insurance agent to understand your options and fees.
