If you were injured as a result of an auto accident in New Jersey involving a private passenger automobile, you are entitled to benefits. The law is complicated, and your attorney will determine if you qualify for these benefits, known as “PIP”. The rest of this guide assumes that you are entitled to receive P.I.P benefits.
What Is PIP?
P.I.P. is a package of benefits including medical expense benefits, income continuation benefits, essential service benefits, funeral benefits and death benefits. The extent of your benefits is determined in part by New Jersey law, and in part by the coverage limits of the policy providing benefits to you. You must file an Application for Benefits with your insurance company in order to begin receiving benefits.
What Benefits Does P.I.P. Provide?
MEDICAL EXPENSE BENEFITS pay all reasonable hospital, medical, and related expenses incurred for treatment of your injuries. This benefit will pay for in-patient and out-patient hospital visits; doctors; chiropractors; dentists; psychologists; therapists; skilled nursing care; prescriptions; appliances; diagnostic tests such as X-rays, MRIs, CAT Scans, Bone Scans and EMGs; ambulances and medical transportation. There is an automatic deductible of $250, and you may have selected a higher deductible of up to $2500, in exchange for a premium reduction. You will be subject to the coverage in effect on the date of your accident, even if you change your coverage before you incur expenses related to that accident.
There is an 80%/20% co-payment provision on expenses incurred above your selected deductible, and up to $5000. This means that your P.I.P. carrier is responsible for 80% of your medical expenses above your deductible, up to a total of $5000 in medical expenses. You are responsible for the other 20%. These balances may be submitted to any health insurance available to you, subject to their deductible and co-pays. P.I.P. will make full payment of all expenses in excess of $5000, up to a maximum of $250,000. Additional medical expense benefits up to $1 million are available as an option. All medical expenses are subject to a fee schedule developed by the New Jersey Department of Insurance. You are not responsible for charges billed in excess of the amounts allowed under the fee schedule. You can see how complicated the law is, so ask your lawyer any questions you have.
INCOME CONTINUATION BENEFITS pay for lost wages for a minimum of 52 weeks in the amount of $100 or more per week. This amount can be greatly increased in both weekly amount and time period of payments by selecting available options. These benefits receive a credit for any Temporary Disability Benefits (T.D.B.) you are entitled to receive (whether or not you actually receive them). Therefore you must apply for T.D.B. immediately upon stopping work.
ESSENTIAL SERVICE BENEFITS reimburse you for payments made to others performing tasks such as housework, child care, shopping, food preparation or transportation, up to $12 per day for up to 365 days. Higher coverage limits are available.
FUNERAL BENEFIT pays up to $1,000 for funeral bills incurred as a result of a death caused by an auto accident.
DEATH BENEFIT pays the combined total of available income continuation benefits and essential service benefits that would have been available to a person who dies as a result of an auto accident, up to a maximum of $10,000.
Can My Insurance Company Stop Paying My Benefits Before I Use Them Up?
New Jersey law gives insurance companies providing P.I.P. benefits the opportunity to have you examined by a doctor of their choice in your municipality, to determine whether you have a continuing need for P.I.P. benefits. These examinations are known as “P.I.P. exams”, and are generally performed by physicians who devote a substantial portion of their practice to working for insurance companies. Typically, the doctor determines that any injury you may have sustained has been cured by the treatment you have been receiving, and offers the opinion that you are not in need of further treatment. If your injury is serious and obvious, the doctor may conclude that additional treatment will not result in additional improvement or pain relief. In either case, the insurance company notifies you that they are terminating your entitlement to benefits, and will not pay for any additional treatment. You are not obliged to accept this decision, and if your treating physician is willing to support your need for on-going care, we will aggressively fight for your right to continue to receive treatment.
Claims for these benefits which are challenged by a P.I.P. carrier are resolved either through binding arbitration under American Arbitration Association rules, or by filing a law suit in Superior Court. We usually resolve these controversies through the arbitration process, because A.A.A. claims are concluded in a much shorter time.