Getting into an automobile accident is never fun.  Some of the consequences can be property damage to your car, bodily injuries resulting from the collision and dealing with an insurance company that, although the commercials say otherwise, is not there to protect you.  That being said, if you do get into an accident, Personal Injury Protection, which is commonly referred to as PIP, is a great thing to have.

Normally, after an accident, an injured person will incur medical bills from the hospital, doctors, physical therapists and pharmacies.  How those bills are paid can affect your bottom line when the case is settled.  If your health insurance policy covers those bills, that insurance company can file a lien against any proceeds from the settlement.  Once you get the settlement money, you then have to pay back that money to your health insurance company.  So, if your medical bills amount to $2,500 and you settle the case for $7,500, you would only keep $5,000 from the settlement.  The same goes if the health care providers (hospital, doctors, etc.) aren't paid until after the settlement.  They can file a lien against the settlement proceeds.  And you'll have to pay them back out of your money.

However, if you have PIP coverage through your automobile policy, those bills are handled differently.  Once you open a PIP claim the medical bills are paid by the PIP insurance company.  And, guess what?  You don't have to pay them back.  That is why you pay an extra premium every month for the PIP coverage.  So, in the above scenario, you would get to keep the entire $7,500.  Most PIP only covers the first $2,500 worth of medical bills.  But that is $2,500 you get to put in your pocket.

I highly recommend that you call your automobile insurance company and make sure you have PIP.  If you don't, sign up for it now.