Who Gets Personal Injury Protection (PIP) Monies?

An insurance policyholder in Southlake, Grapevine, Grand Prairie, Arlington, Fort Worth, Mansfield, Burleson, Crowley, or anywhere else in Texas may ask the same question; Who gets the personal injury protection (PIP) monies. It is estimated that only ten per cent of automobile policyholders purchase PIP benefits as an option when they purchase their auto insurance policy. It costs extra, and lots of people just do not want to pay the extra money for this benefit.
The Texas Insurance Code, Section 1952.152, mandates that PIP coverage be offered to any purchaser of auto liability coverage. Section 1952.153, mandates that the minimum amount of coverage for PIP is $2,500. Some insurance companies will offer up to $100,000 of PIP coverage.
Section 1952.155 mandates that this coverage be provided without regard to fault in the accident or any other event that the coverage provides for. The PIP benefits are payable without regard to fault or other sources of insurance coverage. This same section of the Insurance Code states that an insurance company paying benefits under PIP coverage does not have a right of subrogation or claim against any other person or insurance company to recover any benefits by reason of the alleged fault of the other person in causing or contributing to the accident.
So, what does all this mean? First, it means that you should seriously consider talking with an experienced Insurance Law Attorney to make sure you do not handle this in an improper manner and find yourself being sued for not handling it properly. There are liens, subrogation interests, and assignments that may exist that most people are not aware of or think about, that could put a person in a position of being sued when these other interests are not properly acknowledged and / or dealt with.
In the normal car wreck situation involving injury, the injured person will often times have a health insurance plan that pays the injured persons medical bills. These bills may be paid by a private health plan such as one administered by Blue Cross / Blue Shield, Humana, or any number of other private insurers, or the bills may be paid for by a government plan such as Medicare, Medicaid, Veterans Administration, etc. Most of these plans are going to require that they be paid back or reimbursed when the injured person recovers money from some other source or third party, usually the insurance company for the person who caused the injuries.
The Federal case out of the Western District of Wisconsin, styled, Allen v. United States, decided in 1987, makes it clear that the PIP monies are not to be used to reimburse the medical provider. In the Allen case, the Veterans’ Administration, (VA) paid benefits on behalf of Allen. Allen’s insurance company, USAA, tried to pay $130,000 to the VA as reimbursement for medical expenses. Allen sued to protect these monies from the VA subrogation and won.
The Court in its opinion stated that the subrogation interest of the VA was limited to Allen’s recovery from third parties who caused the injuries, not Allen’s own insurance company benefits that were monies payable without regard to liability or fault, such as PIP.
This can be confusing, not only to the policyholder, but also to the insurance company who handles these types of situations on a daily basis across the nation. This is further complicatd by new policies and laws being written that sometimes do allow recovery of some of these “no fault” insurance coverages, such as PIP.
The worst case scenario is that when these situations are not handled properly an unknowing policyholder may find themselves on the losing end of a lawsuit that could end up costing lots of money.