The 3 letters P-I-P stand for personal injury protection. That is the other name for no-fault insurance. It pays for economic losses.
When is it used?
PIP gets used if someone has been injured as the result of a motor vehicle accident. Personal injury protection comes into play anytime that a motor vehicle has been involved in an on-road incident. That means that the involved vehicle had to have 4 wheels. Any motor vehicle that played a part in that on-road incident had to function as a means of transportation, and not as a different tool or device, such as a weapon. The presence and actions of the involved vehicle(s) must have caused a claimed injury.
Are riders in all types of motor vehicles covered under a plan that offers personal injury protection?
No, if a motorcycle collided with an automobile, the motorcycle would not be covered. The rider of the motorcycle would need to seek coverage from the insurance policy purchased by the owner or driver of the automobile. Similarly, farm vehicles, commercial vehicles and business vehicles are not covered by PIP. Neither are ATVs. Furthermore, if a camper were parked at a campsite, the camper’s occupants could not be guaranteed personal injury protection.
Are any penalties associated with carrying or not carrying PIP?
In states that require purchase of a no-fault provision by the car owners, when buying an auto insurance policy, there are penalties for failure to satisfy that particular requirement. Different states impose different penalties. For instance, in some states the driver’s license could be suspended. In others, the driver could be fined. Moreover, there are some states where a car owner/driver lacks the ability to receive certain damage awards, if he or she has failed to pay for a no-fault provision. Accident Lawyer in Waterloo knows that awards for pain and suffering could be denied in cases where an involved vehicle did not have the no-fault protection.
What sorts of events pushed insurance companies to offer the no-fault provision in a car insurance policy?
Until introduction of the personal injury protection, insurance companies did a poor job of protecting the driver and passengers in a car that was hit by an uninsured driver. Yet some of the worst accidents were caused by drunk drivers, who seldom carried any form of insurance. As a result, a driver that was rear-ended by a drunk driver had to seek compensation from his own insurance company. Sometimes, that company would claim that the driver of the hit vehicle was partly responsible, in order to reduce the size of the compensation package.
Some drivers objected to that approach and chose to sue, in hopes of obtaining fair compensation. Eventually, insurance companies realized that they could avoid such lawsuits by offering customers the chance to buy a no-fault provision. Consumers welcomed introduction of PIP provisions. The personal injury protection guaranteed compensation to all injured drivers and passengers. Reliance on the insurance company’s protection failed to accomplish that goal, if a threatened lawsuit did not enter the picture.