First Party coverage in car insurance relates to the coverages which the policy offers to the individual insured. Two main parts of automobile insurance coverage are medical payments (Med Pay) and Personal Injury Protection (PIP). The type of insurance coverage chosen will fluctuate depending on what is requested in each state. It is very necessary to learn these two very different types of insurance coverage and how it will handle any probable car insurance claims.

Both Medial Payments Coverage and Personal Injury Protection are regarded as \’first party coverage.\’ This suggests that it applies to the named insured or member of the insured\’s household, the passengers of the insured and certain others on occasion.

Understanding Medical Payments (Med Pay)

Medical Payments Coverage is compulsory in some states that do not have \’No Fault\’ laws in place. Med Pay Coverage will pay for acceptable medical and burial expenses due to bodily injury or death that is brought about by an automobile accident.

The limit of liability for Med Pay Coverage is stated in a auto insurance policy declaration page. There is a limit on medical payment coverage. This is the limit per qualified injury party related to the accident. Ultimately, Med Pay Coverage will allow for the injured party to receive medical treatment and not worry about the costs associated with that treatment. The most typical limits on Medical Pay are $1,000 to $5,000 per person, although a limit of $25,000 is obtainable with some companies, normally preferred companies. Certain non standard companies provide up to $1,000 per person.

Understanding Personal Injury Protection (PIP)

Which party is legally responsible for paying for bodily injury in case of an auto accident? You, or the other operator? In jurisdictions that draw from the \”tort liability\” system, the individual that prompted the damage is the same one that is determined to be responsible for having to pay all the damages. What about if you were, to a certain degree mostly responsible for an accident, who will pay for your bodily injury? To eliminate the course of the operator looked at as not to have caused an accident having to file a lawsuit the other driver\’s insurance company to cover damages, PIP policy was \’invented\’ to deal with that issue. States that embraced PIP policy are called the \”no fault\” states. Fifteen states as well as the District of Columbia require following the \’no fault\’ system, hence requiring automobile insurance policies to include the Personal Injury Protection or PIP,. These states are: Delaware, Florida, Hawaii, Kansas, Kentucky, Massachusetts, Michigan, Minnesota, New Jersey, New York, North Dakota, Oregon, Pennsylvania, Texas, and Utah.

Illinois is one of the states that still feature the traditional \”tort liability\” systems in which there are no constraints on law suits. To get paid for your bodily injury you must sue someone, and you may win based on the particulars that your adversaries were negligent and induced your bodily injury that specifically caused you loss and suffering. That is why medical payment is even more important in Illinois: You do not have to sue any one to collect it. Remember that the fact that Illinois, or any similar state, is not an \’at fault\’ state, it does not prevent auto insurers to endorse their policies to embrace the PIP. But with the intense competition among car insurance companies, only few give you the choice to have the PIP endorsement, at additional higher price.

Coverages and Limits: Despite the fact that PIP minimum coverage limits vary between involved states, they are similar in that the benefits usually cover most injury-related costs including: medical bills, lost wages as a result of injuries, payments for loss of services, burial expenses, and death benefits. The PIP can also cover bills associated with certain psychiatric assistance in connection with bodily injury, physical or occupational therapy and any rehab costs associated with car insurance claims.

Typically, damages such as pain and suffering, and emotional distress and inconvenience are not covered by no-fault insurance coverage. In addition, PIP does not provide any protection for any injury caused by work related auto accidents.

Finally, if you live in a \’no fault\’ state, there is one reason to not purchase both Med Pay and PIP insurance. There is an overlap in coverage. This is because PIP insurance provides more coverage in case there is a need to file medical claims related to a car accident, regardless of fault.

Deductibles on PIP Liability: Most people in \’no fault\’ states are used to the PIP policy without any deductibles, although it is not uncommon to find some companies offering PIP with deductible.

Author Bio: Ed Sneineh, insurance professional for over 20 years, former college educator of insurance, and founder of Insurance Navy, a leader in quoting auto insurance Chicago. Visit our blog for up to date information or get your Sr22 Filing Illinois in 5 minutes or less. Insurance Navy represents major carriers such as AAA, Travelers, Progressive, Hartford, and more than 20 others.

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