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No-fault insurance, otherwise known as personal injury protection (PIP), helps pay the costs of a driver and his passengers’ medical expenses following a car accident. Whether it’s the driver’s fault or not, the benefits cover anyone in the insurance holder’s vehicle. This separates PIP coverage from other policies, which require the at-fault driver to cover expenses. 

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In states that require no-fault insurance coverage, both parties involved in a car accident would file a claim to their insurance providers, regardless of who caused the accident. This PIP policy limits a party’s ability to sue the other party, except in a case of extreme injury. It also shortens resolution time by eliminating the possibility of a lawsuit between parties involved. It’s important to note that PIP coverage varies from state to state. In some states that don’t require no-fault insurance, it may be available as an add-on to your existing auto coverage. 

The Coverage Benefits

It’s important to note that no-fault insurance only covers personal injury expenses, not any damages done to vehicles. The coverage can also include other things related to personal injury, such as medical expenses, lost wages, funeral costs, and other essential services. PIP may pay for any medical treatments or surgeries that are needed following a car accident. If injuries kept a party from working or being able to complete essential work, like cleaning or grocery shopping, there is a chance that PIP would cover those costs. Additionally, if someone was killed as a result of a car accident, PIP may cover the cost of funeral expenses. 

Which States Require it?

Twelve states in the U.S. require drivers to have PIP coverage, while three of those states leave the choice optional to the driver. The remaining states use a tort liability system, which requires the at-fault party to cover the damages of the injured party. The “at-fault driver” and his insurance provider can counter claim and sue if they disagree with who was truly at fault. This, in turn, elongates the resolution process. 

States Requiring PIP Coverage

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  • Florida
  • Hawaii
  • Kansas
  • Kentucky*
  • Massachusetts
  • Michigan
  • Minnesota
  • New Jersey*
  • New York
  • North Dakota
  • Pennsylvania*
  • Utah

* Indicates it’s required, but in some cases may be waived. 

What’s the Cost?

There are different factors that will determine the cost of your PIP coverage. Your past driving record, the insurance company you choose, the state you live in, and how much you are willing to pay for coverage all affect the cost. The age of the driver and type of vehicle are also determinants for your no-fault insurance cost. 

It’s important to point out that the cost of no-fault insurance coverage varies from state to state. The average premium for states that require PIP coverage ranges from $24 to $600 depending on the amount of no-fault coverage required by a state. Michigan has the highest PIP coverage, while Utah has the lowest coverage. This is due to specific determinants and characteristics required by the different states. 

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