Personal Injury Protection (PIP) is coverage within your policy of insurance that covers medical expenses and lost wages as a result of injuries sustained in a car accident. This coverage will apply no matter who is at fault in the accident. PIP is required under the current laws of Texas. The Texas Insurance Code provides that all policies of automobile insurance issued in Texas must provide for PIP coverage for a minimum of $2,500 per person, unless rejected in writing by the insured. If you choose to forego PIP, then your insurance company is required to get you to sign a waiver or rejection of PIP. If an insurance company is unable to produce a signed waiver for PIP then the insurance is required to cover you for the minimal amount as stated in the Insurance Code. It should be noted further that the MINIMUM for PIP is $2,500, however insurance companies do typically provide coverage up to $10,000 dollars. PIP is extremely helpful if liability is in dispute between the two insurance companies or if the at fault insurance company is unwilling to give you fair value for your claim. PIP can provide someone involved in an accident with necessary funds for medical payments and lost wages.
Medical Payments coverage (Med-Pay) also provides coverage regardless of whose at fault in the accident. Med-Pay only covers medical bills. Lost wages are not recoverable under MedPay. MedPay is also coverage that one obtains through their own insurance carrier and since it is not mandated by law, rejection by client of MedPay are not necessary.
A significant difference between PIP and MedPay is that PIP covers both medical bills and lost wages. However, MedPay also operates differently in that if your insurance carrier pays out on MedPay then your insurance carrier is entitled to recapture those funds in the event there is a settlement with a third party. This is commonly referred to as “subrogation” and this often becomes an obstacle to settlement of claims in motor vehicle accidents. This is a very important difference and an important disadvantage of MedPay.
Under most circumstances, if you collect money under your PIP coverage, you will not have to pay back your insurance company if you receive a settlement from another insurance company. In contrast, if you receive a settlement under MedPay coverage, you likely will have to pay back you insurance company.
How An Attorney Can Help
An attorney can help you with maximizing the amount of MedPay that you would receive in several ways. One way attorneys can help you is that they can sometimes reduce the amount of monies that you would normally be required to pay back to the insurance company. This is one of the several reasons to consult with an attorney for the best outcome.
These matters are further complicated because MedPay monies to be paid back to the insurance company can sometimes be reduced after negotiations with an attorney in some cases. This is one of the several reasons to consult with an attorney for the best outcome.
