If you're hurt in a car accident in New Jersey, the first insurance that pays your medical bills is usually your own, through Personal Injury Protection (PIP). PIP is required on every New Jersey auto policy and pays no matter who caused the crash. It's also one of the most misunderstood parts of a New Jersey injury claim. Here are clear answers to the questions injured people ask most.
What is PIP?
PIP is the no-fault part of your auto insurance, required by N.J.S.A. 39:6A-4. It pays medical expenses from a car accident, and on a standard policy it also pays some lost income and other benefits, whether you caused the crash, the other driver did, or nobody did. PIP does not pay for pain and suffering. That comes from a separate claim against the at-fault driver.
How much PIP coverage do I have?
It depends on your policy. On a standard policy, you can choose a PIP medical limit of $15,000, $50,000, $75,000, $150,000, or $250,000. If you don't choose, the default is $250,000. A basic policy provides $15,000 in PIP, with up to $250,000 available for certain catastrophic injuries such as permanent or significant brain injury, spinal cord injury, or disfigurement. Your declarations page shows your limit, along with your deductible and copay.
Whose PIP pays?
PIP generally follows the person, not the car. The usual order is:
- Your own auto policy, if you own an insured car
- The policy of a relative you live with who has an auto policy
- The policy of the car you were in, if you have no coverage of your own
- For pedestrians and others with no auto insurance anywhere in the household, the policy of the car that hit you
- If none of these apply, a claim may go to New Jersey's Unsatisfied Claim and Judgment Fund, run by the Property-Liability Insurance Guaranty Association (PLIGA)
Does PIP cover pedestrians and cyclists?
Yes. If you're a New Jersey resident hit while walking or biking, your own or your household's auto policy pays PIP. If no one in your household has auto insurance, the PIP coverage of the car that hit you usually applies. More on pedestrians in our pedestrian accidents section.
What does PIP pay for besides medical bills?
On a standard policy, PIP also includes:
- Income continuation: part of your lost wages, up to $100 per week and $5,200 total under the standard benefit. You can buy higher limits.
- Essential services: up to $12 a day, with a $4,380 maximum, for help with tasks you can't do while injured, such as housework or childcare.
- Death benefits and funeral expenses: benefits for survivors, plus up to $1,000 for funeral costs.
A basic policy provides medical PIP only. Check your declarations page for your options.
Is there a deductible?
Yes. The standard PIP deductible is $250, with higher options available. You also pay a 20% copay on medical expenses between your deductible and $5,000. Your health insurance may cover those amounts.
What if I chose health insurance as primary?
Some policyholders choose to make their health insurance pay first, which lowers the auto premium. If you did, your health plan pays first, and PIP covers what's left that the plan doesn't. That can mean in-network rules, referrals, and copays you wouldn't have with regular PIP. Medicare and Medicaid can't be made primary this way.
Why is my insurer requiring "precertification"?
New Jersey PIP is managed care. Insurers use a "decision point review plan" that requires precertification for many tests and treatments after the first ten days, and they apply standardized care paths for common neck and back injuries. If you or your doctor skip a required step, you can face a copay penalty, so make sure your providers know you're treating under PIP and have your claim number.
What happens if PIP denies my treatment?
You can appeal internally under the insurer's plan, and then take the dispute to PIP arbitration. In New Jersey, PIP arbitration is handled by an administrator called Forthright. Many medical providers bring these cases themselves after you assign your benefits to them. A denial doesn't mean the injury isn't real, and it doesn't affect your separate claim against the at-fault driver.
Can I sue the other driver for my medical bills?
Generally, you can't recover from the at-fault driver medical expenses that PIP paid or should have paid. That's the trade-off of the no-fault system (N.J.S.A. 39:6A-12). Your lawsuit against the at-fault driver is mainly for pain and suffering and economic losses PIP doesn't cover, such as lost wages above your PIP benefits. If your bills go beyond your PIP limit, whether you can claim the excess can depend on your policy choices and current law, so have a lawyer review it.
Does using PIP raise my premium?
New Jersey law restricts surcharges for accidents you didn't cause, and a PIP claim on its own after a not-at-fault crash generally shouldn't lead to a surcharge. If you think you've been surcharged unfairly, you can file a complaint with the New Jersey Department of Banking and Insurance.
Do I have to cooperate with my own insurer?
Yes. Your policy requires you to cooperate with your PIP carrier, which can include filling out an application, providing records, and sometimes appearing for an examination under oath. This is different from the at-fault driver's insurer, to whom you owe nothing. Read what not to say to an insurance company to learn the difference.
The bottom line
PIP gets your medical bills paid quickly. It doesn't compensate you for what the crash took from you. Pain, lost years of normal life, and lost earning power are recovered through a separate claim against whoever caused the crash. Whether that claim is limited depends on your lawsuit option.