After being involved in an accident that was not your fault, you are faced with many struggles. You are in pain and may be hospitalized—you then learn that the at-fault driver will not be held responsible for your medical bills, adding to the extreme stress you are under. The reason the responsible driver’s insurance will not cover your medical bills is due to the fact that New Jersey is what is known as a ‘No Fault’ state.
What Does ‘No Fault’ Mean
What the ‘No Fault’ law states is that each driver involved in an automobile accident is responsible for his or her own medical bills either through their own auto insurance policy or health insurance. It does not matter if you were at fault for the accident or not, you will still have to cover your own medical expenses.
The section of your policy that will cover these costs is known as ‘personal injury protection’ or PIP insurance. In the case that you have listed PIP as primary on your insurance policy, this will cover your medical expenses up to the limit you have chosen before the costs are placed on your health insurance policy.
What Does PIP As Primary Mean?
When you are purchasing your auto insurance policy you will be able to choose how much PIP coverage you would like—the standard is $250,000, but you can adjust it higher or lower. They will then ask if you would like PIP to be primary or your health insurance policy. It is very likely that your insurance company will try and convince you not to put PIP as primary by informing you that they charge higher rates for having PIP as primary. Despite the extra expense with regard to your monthly premium, PIP as primary is the better choice in the long run because if you are injured in an accident you will want to have access to those funds for your medical costs.
If you do not choose to have PIP as primary, you will never have access to that coverage regardless of what level of coverage you chose. Paying extra for additional PIP coverage, above the $250,000 standard, will be of no consequence if it is not primary. In the case of pursuing a personal injury claim following your car accident, since you utilized your health insurance coverage rather than the auto policy, the health insurance company can then place liens on your settlement demanding reimbursement for the costs they covered that would have been covered by PIP.
So, essentially not choosing PIP as primary will then translate into less of a recovery in a personal injury claim because the health insurance company has a right to seek reimbursement for the costs they covered.
Understanding Auto Insurance in New Jersey
With all of the loopholes and coverages within a New Jersey auto insurance policy, it can be very confusing as to how this will all affect you in the long run. If you have any questions about your policy or if you have been injured in a car accident, call the New Jersey auto accident lawyers at Console & Associates P.C. today at (833) 690-4940. We can explain your coverage options and how they will affect your personal injury claim.