Personal injury protection, or PIP, is a type of auto insurance that covers medical expenses if you’re involved in an accident. Also known as no-fault insurance, PIP covers you and your passengers regardless of who caused the accident.
PIP insurance isn’t just limited to when you’re driving. If you get injured in an automobile accident while walking or riding a bicycle, this insurance can help cover costs up to the limit you choose.
Importance of PIP Insurance
Car accidents usually come with several financial implications, especially if you get injured. PIP insurance helps reduce the financial burden that often comes after you get into an accident.
What is PIP insurance? Personal injury protection policies help pay for any medical treatment you and your passengers incur, even if you don’t have health insurance or your health insurance can’t cover all the expenses. With PIP, you don’t have to pay out-of-pocket for the extra costs that your health insurance doesn’t cover.
On top of medical bills, a PIP auto policy also helps cover costs like:
- Funeral Costs: If you or any passengers in your car pass away, PIP insurance can help pay for burial or cremation expenses.
- Lost Wages: PIP will pay a percentage of your gross income up to a certain period if the auto accident makes you unable to work.
- Survivors’ Loss: If you die following a car accident, PIP can reimburse your dependents a certain amount of your income — like a small life insurance benefit.
- Essential Services: Your PIP auto insurance coverage can also pay for household tasks, such as childcare or cleaning, if you can’t do them because of your injuries.
PIP Insurance vs. Other Insurance Types
When buying insurance, you must understand how the PIP insurance meaning differs from other policies. This is essential so that you know what to buy to ensure you’re properly covered.
PIP Insurance vs. MedPay
Both medical payments (MedPay) coverage and PIP insurance cover medical care and funeral expenses. However, they differ in their coverage scope. MedPay provides limited coverage that doesn’t cover essential services like lost wages and survivors’ loss.
PIP Insurance vs. Bodily Injury Liability Coverage
Unlike PIP, bodily injury liability is an at-fault type of insurance. This means that it doesn’t cover you if you get into a car accident. It only helps pay for the medical expenses of the other parties — passengers, pedestrians, and the no-fault driver — injured in the accident that you caused.
Additionally, PIP insurance doesn’t cover property damage. On the other hand, bodily injury liability covers the property damage of the third party involved in the accident if you (the policyholder) are at fault.
State-Specific PIP Requirements
As of 2025, only 12 U.S. states require you to purchase PIP insurance. These are commonly referred to as no-fault insurance states. Each state has different minimum coverage limits, and some allow policyholders to sue for additional damages under certain conditions. Therefore, it’s essential to review your local state’s requirements so you have adequate coverage.
For the rest of the states, this insurance is either optional or not required at all. Examples of states where PIP is optional include Washington, South Dakota, Texas, and New Hampshire.
Here is a detailed outline of PIP requirements in all the states that require PIP insurance:
| State | Minimum required PIP Coverage |
|---|---|
| Florida | $10,000 |
| Hawaii | $10,000 |
| Kansas |
|
| Kentucky | $10,000 |
| Massachusetts | $2,000 |
| Michigan | Michigan auto insurance policies have unlimited PIP medical benefits |
| Minnesota | $20,000 |
| New Jersey | $15,000 |
| New York | $50,000 |
| North Dakota | $30,000 |
| Pennsylvania | $5,000 |
| Utah | $3,000 |
Source: American Property Casualty Insurers Association and State insurance departments
Advantages and Limitations of PIP
Like most auto insurance policies, PIP has both advantages and disadvantages worth looking into so you know what to expect. This is especially important if you’re in a state where PIP is either not required or optional, so you can make the best choice on whether to purchase it or not.
Advantages of PIP Auto Insurance
- Provides Immediate Coverage: PIP insurance ensures the policyholder receives financial support immediately after filing a claim, unlike bodily injury liability, which may require going through legal processes after filing a claim against the at-fault driver’s auto insurance company.
- Covers You and Your Passenger(s): Unlike MedPay, which covers just you (the policyholder), PIP covers the medical costs for you and any other person present in your vehicle at the time of the accident.
- Reimburses You and Your Dependents For Lost Wages: If you lose your job or are unable to work due to injuries caused by a car accident, PIP insurance provides lost wages up to a certain amount and period. It may also reimburse your dependents if you pass away from injuries caused by the accident.
Limitations of PIP Auto Insurance
- Does Not Include Property Damage: PIP insurance doesn’t cover your vehicle’s repairs if it gets damaged in the accident — even if you weren’t at fault.
- May Overlap with Health Insurance: If you have comprehensive MedPay coverage, getting a PIP policy in states where it’s not mandatory may not make sense.
- Can Be Expensive: Because PIP guarantees coverage regardless of fault, insurance premiums in no-fault states tend to be higher than in states without PIP requirements.
Saving More on Your Car Insurance
While having a PIP insurance policy is essential, especially in no-fault states, you don’t have to spend a fortune. Finding a cheap car insurance policy can help you save money.
At EverQuote, we can help. We find the best car insurance discounts that align with your needs, so you’re adequately covered at an affordable price.
Get free auto insurance quotes from different insurance companies today.