Lately I have received several questions about how health and disability insurance policies work with PIP. We thought it was a good topic to discuss, so the following post will explain how it works.
What is PIP?
PIP or Personal Injury Protection is a specific coverage that is found on all Michigan auto policies. In this state, if you are injured in an auto accident, you have access to lifetime unlimited medical care. In order to fund this type of system, the state of Michigan has established an organization called the MCCA or Michigan Catastrophic Claims Association. Every vehicle that is insured in the state of Michigan is currently charged $178 per vehicle per year which goes directly into that fund. When auto injuries occur, the first $500,000 come from your auto insurance carrier. The remaining costs are pulled from this fund.
How Does Health Insurance Work With PIP?
The answer to this question is dependent upon your health insurance or disability carrier. If you coordinate your health coverage, and you are injured in an auto accident, your no-fault policy will pay your medical expenses after you have used up all the benefits from your health plan. If your auto insurance carrier requires a letter confirming coverage, you can call the customer service number on the back of your card. Whether your coverage is an individual plan or through an employer every health insurance carrier’s policies, such as BCBSM or a commercial carrier such as Aetna, it is always good to call customer service, prior to meeting with your agent.
How Does Disability Insurance Work With PIP?
Coordination of benefits holds true if you have a disability policy as well. If your disability policy allows coordination, your PIP coverage can be set up as excess income. This means the PIP coverage on your auto policy will pay in excess of your disability plan. Some auto policies may even allow you to ‘stack’ your disability income, since most disability carriers pay to a percentage, usually approximately 60% of your lost income.
We know this sounds “insurancy” and that’s why you have us. For additional information on how to find out if your health or disability plan covers you in the case of an auto accident, contact Lindsie Williams |906.315.7232 | email@example.com.