OK folks, we are continuing the definition of coverages this week. Please stay with me as this one is BORING, but it can keep you from loosing money you are entitled to if you know how to use it so pay attention.
Personal Injury Protection (PIP) and Medical Pay (Med Pay), while these coverages have some similarity, they are very different. PIP and Med Pay are usually sold in 2,500, 5,000 or 10,000 amounts with 10,000 being the max amount sold in Texas.
PIP usually is used to pay for medical bills and lost wages. It may also be used for domestic assistance, if you are the main person doing the housework. Check with your carrier on this as each carrier may differ. To use it for medical bills, an assignment of benefits form needs to be signed by you to the medical provider you want to use your PIP. The medical provider(s) will spare no time to use it till there isn't anything left as medical providers seem to view PIP or Med Pay as a slush fund.
Med Pay pays for medical bills but it may not pay for lost wages so check with your carrier as carriers differ on this. To use your Med Pay to pay for your medical bills, you must sign an assignment of benefits with the medical provider you want to use your Med Pay benefits or you submit your medical bills directly to your claims department, not your agent.
Please note-If you want to file a PIP or Med-Pay claim yourself, call your claims department and tell them you want to open a PIP or Med-Pay claim and will be sending them bills needing to be paid or tell them a medical provider will be sending your claims department medical bills that you want paid. Yes, you have to speak that directly to your claims department or your bills will sit in a file which will eventually get closed.
While you are filing a claim on your own policy benefits, your carrier does have the right to investigate the facts and circumstances of your claim to make sure they should be paying out on the claim.
PIP extends to the insured, listed additional drivers on your policy, passengers in your vehicle and to listed members of your house hold. It may also extend to people you allow to use any of your vehicle that are not members of your household. Check with you carrier as carriers differ on this.
PIP usually cost more than Med-Pay and there is a good reason. If you are in an auto accident and recover any money from the other drivers carrier and have Med-Pay, your carrier will get all the money they paid out on your medical bills back, it's called Subrogation, leaving you little or nothing. That's why Med Pay usually cost less than PIP. With PIP, if you use it and recover any money from the other drivers carrier, none of that money is touched by your carrier to reimburse them. Now, do you see the advantage of PIP to Med-Pay?
In Texas, if you submit your medical bills to your PIP, you can also submit them to the drivers carrier, if you are a passenger in a vehicle that carries PIP on their policy. While it looks like your getting paid twice on the same bills, you are. Only the great state of Texas could come up with such genius. I guess that why our legislature only meets every other year.
If I had a choice between PIP and Med-Pay, I always would go with PIP.
Attorney's and PIP/Med-pay are a very bad combination. Do not EVER let an attorneys office handle your PIP or Med-Pay benefits for you. Here is why, they will usually charge you a 10% fee to do the same thing you can do, forward your bills to your carrier for payment. So, if you have 10,000 in PIP or Med-pay, you will only have $9,000.00 to use because your attorney took $1,000.00 for themselves as a fee. So, now how helpful are they really being?
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