OVERSIMPLIFYING A COMPLEX SUBJECT
During your lifetime, you are unlikely to sustain injuries from an auto accident that requires medical care. However, when people do find themselves in this unfortunate situation, many questions tend to arise. I have found throughout my many years of practicing personal injury law in New Jersey, the first question that auto accident victims often ask is “who pays my medical bills for my injuries?” The simple answer to this question is your own auto insurance company pays regardless of who is at fault. New Jersey is known as a “No-Fault” state. Under New Jersey insurance law, whenever an auto accident involves a private passenger motor vehicle, the auto policy insuring the injured party becomes the primary coverage for medical care. If the injured person does not have auto insurance and there is no other auto insurance policy in the injured person’s household, then the policy covering the vehicle in which he/she was occupying at the time of the accident would provide coverage. The coverage for medical care is listed under the section of the policy pertaining to Personal Injury Protection also known as PIP.
WHAT IS ADEQUATE COVERAGE?
In as much as the injured person’s own insurance company provides coverage, it is extremely important to ensure that you have sufficient PIP coverage. What is adequate coverage? Given the high cost of medical care, it is widely accepted that $250,000 in PIP coverage should be purchased. Due to tough economic times, I have recently encountered clients who have purchased reduced PIP coverage in the amount of $15,000 in order to save money. Unfortunately, my experience has shown that this amount of coverage is wholly inadequate, especially if an auto accident victim requires surgery. Moreover, the savings in premiums from purchasing reduced PIP coverage is insignificant, at times only $50 for a six-month policy. Higher PIP coverage is especially important when you do not have health insurance to cover your medical bills after your PIP coverage has been exhausted. Those with PIP coverage of $15,000, without health insurance, can find themselves unable to seek necessary medical treatment because they have exhausted their PIP coverage and are unable to pay for medical treatment out of pocket.
In addition, auto insurance companies will offer an option to have your health insurance coverage serve as the primary coverage for your auto accident injuries rather than PIP. This can prove to be a trap, especially when you have an employer-based health plan that requires reimbursement for benefits paid on your behalf from any recovery you may be able to obtain from the driver who caused the accident. Moreover, electing to have your health insurance company serve as primary coverage results in minimal savings in auto
The foregoing is an oversimplification of what can be a complex and confusing subject. It is important to ask your insurance agent any questions that you may have at the time you purchase your auto insurance policy. You definitely do not want to discover that you do not have adequate PIP coverage after an accident happens and a claim is made for benefits.
If you have any questions or find yourself, a family member or friend in need of an auto accident attorney, please feel free to contact me to discuss your options. I have over 26 years of experience representing victims of auto, truck, bicycle, and motorcycle accidents.