Unlimited Personal Injury Protection (PIP) pays for our auto accident medical costs for the rest of our lives, even if our auto policy cancels the day after the accident. Insurance agents recommend Unlimited PIP because they appreciate its value and the protection it provides for your finances and quality of life.
There are other options that could lower what you pay for PIP. Give this article (and the next) a read to see if you want to follow up with your agent for a good conversation on a PIP decision that could lower your insurance costs.
To simplify things, the conversation depends on you (1) having a health plan or no health plan at all; (2) being on Medicare or Medicaid. This article will address the PIP conversation for those in the first camp. Our next article will explore the Medicare and Medicaid conversation.
If your health plan is willing to be “first payor” on auto accident medical costs, you can: (1) coordinate your health plan with your PIP, which means your health plan will pay first and your PIP will pay what PIP pays second (including your health plan’s co-pays and deductibles); (2) select a limit for PIP of $250,000 or $500,000 AND choose to coordinate with your health plan; (3) opt out of PIP if your health plan is considered a “qualified health plan (QHP).” This last option is somewhat complex and tougher to explain in a short article!
If you don’t have a health plan you can select Unlimited PIP, or the $250,000 or $500,000 PIP limits. Without a health plan, these PIP limits are riskier for you if you are injured in an auto accident.
How do you weigh what you save vs. what risk you’re taking on with your PIP decision? The odds are pretty low that you’d be in an auto accident with medical costs of over $250,000 or $500,000, now that the state’s new fee schedule is telling medical providers how much they can charge. Still, the possibility is there. I’ve got Mrs. Michael and a college kid depending on me for this decision… so there’s no way I’m giving up Unlimited PIP. But that’s me. How about you?