Personal Injury Protection coverage is a wonderful and often overlooked insurance coverage. Personal Injury Protection, or PIP, is known as first-party coverage. This means you buy it to protect yourself and those riding in your car. Personal Injury Protection is easy to collect, and generally, a lawyer is not needed to apply for and obtain the money owed under the terms of this coverage. Tate Rehmet Law Office helps our clients with Personal Injury Protection as a courtesy, without charge.
Texas Medical Payment coverage, or Med Pay, is different. If you have Med Pay, then please click here for more information.
2. Who Can Collect Personal Injury Benefits
a. Read This First
This section discusses who is covered under the terms of the Texas Standard Personal Auto Policy. The terms in your policy may vary from the standard policy language. Please read your own policy to verify the scope of coverage.
Insurance coverage can be very straight forward, but can also be a complicated area of law. If you have any questions about whether an insurance company must cover an injured individual, you must consult with an attorney. This section does not explain all aspects of insurance coverage.
b. Quick Tips About Who Can Collect Personal Injury Benefits
1. Personal Injury Protection is an optional coverage that costs extra money beyond a standard liability-only policy.
2. Call the agent who sold the policy, or the insurance carrier to verify whether you have PIP.
3. Named insureds (people named on the policy) are always covered by Personal Injury Protection – regardless of what car they are in at the time of the wreck.
4. Family members who are not named on the policy are generally covered people, so long as they are not in a car owned by a family member that is not listed on the policy as a covered auto.
5. Injured people riding in cars listed on the policy are generally covered by Personal Injury Protection for that car.
6. The borrowed car scenario can lead to several layers of Personal Injury Protection coverage for the same injured person. The borrowed car scenarios can become confusing, but can also trigger coverage of more than one Personal Injury Protection policy.
Personal Injury Protection is not required under Texas law but is an optional coverage you can purchase in addition to the required liability policy which we all must carry. The policy language for Personal Injury Protection coverage is written so that it covers certain people and certain cars. The easiest way to determine if you are covered by Personal Injury Protection as a named insured, or if your car is covered as a covered auto, is to call the agent who sold you the policy and ask them if you are covered. Calling the insurance company and making the claim is also a good way to find out if you are covered. Determining if you are covered is usually an easy task, but can become complicated under certain circumstances. Generally, there are covered people and covered cars which are identified by name or make, model and year on the declaration sheet – which is the documents you received from the insurance company showing who, and what vehicles, are covered on the policy.
Covered people always include the named insured and generally include the family members of the named insured. The named insured is the person who bought the policy and any other people who are identified by name in your insurance papers. Family members are generally defined to include those people related to the named insured by blood and living under the same roof as the named insured. This means that family members who are not named on the insurance policy may also be covered. Remember the policy defines a family member as anyone related to the named insured by blood, marriage, or adoption and living with the named insured at the time of the wreck. Be sure to read the terms of your policy. Many policies cover family members, but some do not.
Covered cars are identified in the insurance papers by make, model and year. Anyone riding in a covered auto is covered by the Personal Injury Protection policy, regardless of whether they are a named insured or related to a named insured. Being hurt in, on, getting into or out of a covered auto qualifies that person for benefits of the Personal Injury Protection coverage. It does not matter if the injured person is not named in the policy as long as they are occupants of the vehicle that is covered.
It is possible then to be covered by Personal Injury Protection because you are the person named as a covered person in your auto policy, but you may also be covered by a friend’s policy on their car if you get into their car and ride as a passenger. This scenario leads to two layers of Personal Injury Protection coverage, and both policies will pay if you become injured in a wreck. This is what we call the “borrowed car scenario” and we are always on the lookout to see if we can collect multiple polices as a result of covered people riding in other covered cars which they don’t own. The borrowed car scenario can become complicated, especially if there are family members who are not named in the policy riding in borrowed cars. If you are unsure about whether Personal Injury coverage applies to you, then please call our office and we will review the coverage with you.
Below is a set of hypothetical scenarios which illustrate Personal Injury Protection coverage:
Let’s pretend Mary buys Personal Injury Protection from State Farm on her Ford. She lives with her children Harry, who is 17, and Jane who is 9. Harry drives a Chevy, but it is covered by a separate liability only policy without any Personal Injury Protection which is from Allstate. They live next to the Hendersons who own a van covered by Farmers with a Personal Injury Protection policy.
When anyone is in the Ford they are covered because the Ford is a covered auto. Mary, Harry and even Harry’s friend Bill are all covered when they are in the Ford. Personal Injury Protection coverage on the car covers everyone in the car.
What if Mary, Harry, and Jane get into the Henderson’s van and ride with them to the movies? Everyone in the van is covered by the Henderson’s Farmer’s policy on the van because the van is a covered auto so all occupants are covered. Mary is also covered under the State Farm Personal Injury Protection policy because she is named as an insured in that policy. Harry and Jane are covered under the State Farm policy because they are family members of Mary. Remember that family members are related to the named person by blood, marriage, or adoption, and live in the same house as the named person. Under this scenario Mary, Harry and Jane are covered by both Farmers and State Farm. Of course, the Hendersons are only covered by Farmers, because they are not named in the State Farm policy and are not family members of Mary. Typically, the Farmers insurance on the van must be used first, then the State Farm policy will begin to cover once the Farmers policy on the van is all used up.
Our hypotheticals are all easy to understand so far. Unfortunately, the policy contains exclusions for family members who are not specifically named in the insurance policy. The exclusion limits coverage in instances where a family member is driving a car that is not listed on the named insured policy but is owned by a family member. This is a little confusing and is illustrated by the following scenario.
What if Mary rides in her son Harry’s Chevy? The Chevy is insured by Allstate, but without Personal Injury Protection. There is not any Personal Injury Protection coverage on the car, so Harry is not covered by Allstate. Mary is still covered by State Farm because she is the named insured on that policy. The question is whether Harry is covered by State Farm because he is a family member of Mary’s. The rule is that all family members are covered, but if a family member is not a named insured, then they are not covered when driving a vehicle owned by a family member when that vehicle is not listed as a covered auto. Confused? You should be.
This is confusing, but it makes sense when you think about it. Let’s change the hypothetical. Mary has ten children, and all are over the age of 16 and all drive cars. Mary buys an auto policy with Personal Injury Protection, but only lists herself as an insured and her car as a covered auto. All her kids live with her and are related to her by blood, so they are all covered people. It’s not fair to the insurance company to be forced to cover ten additional drivers in ten additional cars without listing them and paying insurance premiums for them. She did not pay premium dollars for them, so they should not be covered when they are in their cars which have not been disclosed to Mary’s insurance carrier.
Simply put, if your family member is riding in a car owned by a friend, look for covered people and covered cars. If you need help, please call us at 903-892-4440. Consultations are free
3. Types of Personal Injuries are Covered
a. Quick Tips About the Types of Injuries and Incidents Covered by Personal Injury Protection
1. Personal Injury Protection is “No-Fault” coverage – so who caused the wreck does not matter.
2. Most injuries occurring in, on, or around an auto are covered.
3. Pays for reasonable medical bills.
4. Pays for Funeral expenses.
5. 80% of lost wages are covered as well.
6. The policy is usually limited to $2,500.00, but can be higher.
Personal Injury Protection is a type of no-fault coverage, so it does not matter how the person was hurt in the wreck. They might be hit by another car, hit a tree, or be hit by a car when walking down the street. In all of these circumstances, Personal Injury Protection should cover the reasonable medical bills and 80% of lost wages.
The policy is usually limited to only $2,500.00, but can be higher.
4. Steps to Make a Claim on Personal Injury Protection Coverage
a. Quick Tips About How to Make the Personal Injury Protection Claim
1. Call the carrier and ask them to send a Personal Injury Protection Application.
2. Fill out the application and return it to the adjuster.
3. Send the police report with the application.
4. Don’t sign medical releases unless absolutely necessary.
5. Send bills to the adjuster (ICD-9 and CPT codes required).
6. Get a check.
The insurance carrier typically will send a Personal Injury Protection application that must be filled out and signed. Click to see an example of a Personal Injury Protection application from Amica. The application calls for a description of the wreck. We usually do not give any detail, but instead, attach the police report. We decline to provide a written statement because written statements can be used against you later. If you do give a written statement, then you must be careful when describing how the wreck happened and the nature and extent of your injuries. Those statements might be used by your own insurance company, or another insurance company, against you later. The application is signed at the bottom. There typically a place to sign higher up, but that line usually is an affirmation of no injury.
Once the application is filled out, it is returned to the adjuster. The adjuster will also send a HIPAA-compliant medical release. We do not have our clients sign these. The language in the release usually gives the adjuster broad-ranging power to get any of your medical records, regardless of whether they are related to the wreck or not. Your medical records and bills are privileged and you should carefully consider waiving your privacy. Once the privilege is waived for your insurance, then it may be waived for others.
Instead of returning the medical release, you should get the bills yourself and send them to the adjuster. Bills from medical providers can be sent with the application or later. Medical bills do need to be itemized with diagnostic and treatment codes, which are commonly called ICD-9 and CPT codes. If your medical bills are from medical providers in Grayson, Fannin, Cooke or Bryan Counties, please click here to see how to get itemized medical bills and records from most of the ambulances services, hospitals, and other emergency medical providers.
If your insurance company absolutely insists on getting a medical release, it is time to call a lawyer for assistance. Non-cooperation is a reason for the insurance company to claim you breach the terms of the policy. Please consult with an attorney if the adjuster insists on a medical release.
After the application and the medical bills and records are sent to the carrier, the insurance company adjuster should send a check to you within a few weeks.
5. Personal Injury Protection is Assignable
a. Quick Tips About Assigning Personal Injury Protection to a Medical Provider
1. Personal Injury Protection can be assigned to a medical provider.
2. The medical provider sends bills directly to the Personal Injury Protection adjuster, and the adjuster will send a check to the provider.
3. Negotiate the price of medical care before assigning the policy to the medical provider
Personal Injury Protection is assignable. If you write a letter to your insurance company telling them to pay a medical provider directly, then the insurance company will pay the bills of the medical provider directly. Some physicians, mostly chiropractors, are willing to treat patients involved in a car wreck and collect payment for the medical bills from an assignment of Personal Injury Protection.
If you assign your Personal Injury Protection to a medical provider, then you should discuss the price of medical care with the medical provider before they start submitting bills to the Personal Injury Protection adjuster. The medical provider will most likely bill a “cash price” for the medical care rendered. The cash price is generally the highest price charged in the medical industry. No health insurance company pays this high price, and the medical provider most likely does not expect anyone to pay it. Negotiate before the medical provider starts submitting bills so that your health care dollars can be stretched as far as possible.
6. The Insurance Company Refuses to Pay or the Personal Injury Protection Reimbursement Rate is Low
Personal Injury Protection is a contract. If the adjuster refuses to pay, does not pay promptly, or does not pay for all the bills incurred, then they might be in breach of the contract. If a breach is shown, then the insurance company may be liable for the money which you are owned, as well as attorney’s fees, and penalties.
7. Personal Injury Protection is a Collateral Source, But May Be Subject to Subrogation
Personal Injury Protection is a collateral source of payment. Collateral sources of payments are a great benefit to an injured person because a collateral source of payment cannot be considered by most other liability insurance carriers. This is best explained by a hypothetical. Let’s pretend that Mary is in her Ford, which has Personal Injury Protection through an auto policy issued by State Farm, and is hit by a drunk driver who is insured by Farmers. Mary is injured and incurred medical bills. She can submit those bills to State Farm and the bills are paid under the Personal Injury Protection policy. Mary can then submit those bills to Farmers and Farms must pay them again. The reasoning is that Mary paid her insurance premiums for her Personal injury Protection coverage, and not the drunk driver. So neither the drunk driver nor the insurance company of the drunk driver receives any benefit from the fact that Mary had Personal Injury Protection.
Personal Injury Protection is subject to subrogation. Subrogation is the idea that if one person hurts another, but a third person pays for the damages, then the third person stands in the shoes of the hurt person to the extent they paid. In a car wreck with injuries, subrogation is most likely the result of health insurance or a benefit like Medicare. Health insurance pays for the medical bills, and the hurt person collects for those bills from Personal Injury Protection or another insurance carrier. This may give rise to an obligation to repay the health insurance or plan that paid for the bills.
8. Every Auto Policy Issued in Texas Has Personal Injury Protection Unless It’s Rejected In Writing
a. Quick Tips About Personal Injury Protection Rejections
1. If the insurance company can’t produce a written rejection, then they must provide the coverage even though no premiums were paid.
2. If they can’t find the rejection, then they won’t respond, and you must call again.
3. After several calls, they will admit they can’t produce it.
4. The carrier may try to charge a premium under these circumstances, but they are not entitled to any payment.
Texas law dictates that every auto policy comes with at least $2,500.00 of Personal Injury Protection unless the purchaser specifically rejects the coverage in writing. In a small percentage of cases, the carrier can’t produce the written rejection. If the rejection cannot be produced, then the carrier must provide the coverage even though no premium was paid.
9. This Document is Not Intended to Establish an Attorney-Client Relationship
This document is intended to be a guide to help non-lawyers make an application for Personal Injury Protection benefits. It is not intended to create an attorney-client relationship. Reading or possessing this document does not mean that Tate Rehmet Law Office will act upon your behalf. Tate Rehmet Law Office only represents clients who have signed a written retainer agreement. If you have not signed a written retainer agreement, then you are not represented by Tate Rehmet Law Office. If you have any questions about Personal Injury Protection benefits, you need to consult a lawyer.