The Difference Between Liability Coverage and Personal Injury Protection

By Albert Howard

Liability coverage and personal injury protection (PIP) coverage are two kinds of commonly used car insurance. Almost all states have made liability insurance mandatory for all drivers. On the other hand, PIP is only available in a few states. Consult a car accident lawyer in Cheyenne to get more information about available insurance in your area.

How are they different?

The critical distinction between liability insurance and PIP insurance is who benefits from it. Liability coverage helps pay expenses that arise from damage to property or physical injuries due to an accident caused by you. PIP, also known as no-fault insurance, assists in covering medical expenses regardless of who caused them. It also helps protect the loss of income due to work inability due to the accident.

Liability Insurance

Liability coverage is mandatory in almost all states. It helps to pay compensation for the bodily injuries or property damage caused by you in an accident.

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The two elements of liability insurance are as follows :

  • Bodily injury liability coverage 

This insurance is applied for compensating the injuries caused by you or other people listed in your insurance policy. It provides coverage for hospital expenses, lost wages due to injury, as well as legal charges if the victim decides to sue you.

  • Property damage liability coverage 

This insurance is applied for compensating property damage caused in an accident by the person responsible for causing the accident. It involves coverage for the repair or replacement of the damaged items.

States fix their coverage limits for bodily injury liability and property damage liability. The amount of coverage is usually displayed by three numbers, like 30/40/20. In this instance, the numbers mean a maximum of $30,000 is for covering the bodily injuries of each person, $40,000 for each accident is for physical injuries, and $20,000 is for covering property damage.

  • PIP Coverage

PIP coverage assists with paying medical bills, lost income or salary, and funeral expenses for accident victims, regardless of who was at fault for causing the injuries or damage. PIP coverage extends to the passengers sitting in your car along with you. It also covers pedestrians being hit by cars.

The mandate and availability of PIP are state-specific. Delaware, Florida, Hawaii, Kansas, Massachusetts, Michigan, Minnesota, New Jersey, New York, North Dakota, Oregon, and Utah are the twelve states that require PIP coverage.

The cost of liability coverage depends on several things, like the amount of coverage, along with factors like driving records, age, and gender of the driver. Monthly charges for a PIP policy can range between $50 and $200.

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