Personal Injury Protection (PIP) coverage is no-fault insurance for individuals injured in auto accidents. Basically, it pays for a victim’s medical bills and lost wages (up to the coverage limits) regardless of who was at fault for the collision. The main benefit to this “no-fault” insurance is that medical bills can be covered very early on in the accident process. In fact, so long as the medical bills incurred are related to the collision, PIP payments are almost automatic in nature – meaning no prolonged fights with the insurance companies over who should pay the bills.
In Maryland, this is incredibly beneficial for accident victims especially those who cannot afford medical treatment otherwise. It allows injured victims to get the treatment they need without compromising their claim against the at-fault driver – often people feel pressure to settle their cases for less than fair value because they need the money to get medical treatment immediately.
Sadly, the District of Columbia has a statute that renders the benefits of PIP essentially meaningless. Pursuant to DC law, an injured driver must choose between (1) filing a PIP claim or (2) pursuing a claim against at-fault fault driver within sixty days of the collision (there are narrow exceptions). This puts incredible pressure on an injury victim. Essentially, victims have to decide whether to forego the most critical element of their claims i.e. pain and suffering compensation by electing the safe option of using PIP coverage within sixty days of an accident.
This quick election is problematic. It is possible that the other driver only carried minimal liability coverage which would cause you to want to elect PIP. However, within 60 days of a collision, you really don’t know what the amount of coverage is available under the other driver’s policy. This is information that insurance carriers keep close to the vest for negotiating leverage. Often, you find out the other driver’s coverage amounts after filing suit (potentially years after the collision occurred).
As a result, you have to make a major financial decision without knowing a critical factor that affects whether your decision is appropriate. If you elect to pursue pain and suffering damages by suing the at-fault driver and it turns out they have very limited coverage, you may have made a disastrous decision by electing not to take PIP benefits. It is patently unfair to force consumers and injured victims to make such quick and life-altering decisions without even being able to get sufficient information necessary to evaluate that decision appropriately.