How Does Personal Injury Protection (PIP) Car Insurance Work in New York?

In New York, drivers are mandated to carry personal injury protection (PIP) coverage per the state's no-fault insurance laws. PIP is a form of medical expense coverage purchased as part of an auto insurance policy. No-fault insurance in New York covers the costs of all injuries drivers and passengers personally sustain, regardless of who was at-fault in the accident. As with other no fault states that require PIP, New York has its own special laws and regulations.

What Is Covered by Personal Injury Protection in New York?

New York is a no-fault state, and personal injury protection is a mandatory form of auto insurance for all drivers. New York PIP insurance covers three things: medical costs, economic losses and death benefits. The minimum amount of PIP you can purchase in New York is $50,000. The amount you purchase will be the maximum you're entitled to recover with a PIP claim.

You can purchase additional PIP insurance if you'd like, which is a worthwhile consideration if you can afford the costs, as medical expenses after an accident can be significant. If you receive any benefits from workers' compensation, Social Security disability, New York state disability and certain employer "wage continuation" plans, your PIP benefits will be reduced by whatever amount you receive from those plans. The insured driver, their passengers and members of their household are entitled to PIP benefits. PIP insurance will also cover injuries sustained in an accident if you're a pedestrian struck by an MTA subway, train or bus.

What Medical Costs Does PIP Insurance Cover in New York?

Most medical costs stemming from a car accident will be covered by your personal injury protection. The covered expenses include the following.

  • Medical services
  • Dental services
  • Hospital expenses
  • Surgical services
  • Psychiatric and physical rehabilitative costs
  • Diagnostic services like X-rays
  • Ambulatory services
  • Treatment in accordance with a recognized religion

Economic Losses Covered by New York PIP Insurance

If you are unable to work because of your injuries, PIP in New York will also pay for any lost wages up to $2,000 per month or 80% of your monthly earnings, whatever is less, for no more than three years after the accident, and up to the policy's limits. For example, if you earn $6,000 a month, you'll be entitled to $2,000 of lost wages. If you earn $1,500 per month, you're entitled to 80% of that amount, or $1,200.

You will also be entitled to $25 per day to take care of routine activities that you can no longer do. Chores such as laundry and home maintenance will be covered by that $25 per day. You may increase the $50,000 limit to $75,000 by purchasing optional basic economic loss insurance (OBEL). You may increase your coverage even further by purchasing additional PIP.

New York No-Fault Insurance Death Benefits

If an eligible insured driver is killed in an accident, the estate of the driver is entitled to $2,000 to help pay for funeral and burial costs. This benefit is common in most states' no-fault insurance laws.

When and How to File a Personal Injury Protection Claim in New York

Knowing how to properly file a claim and when to submit it is pivotal to ensuring a smooth repayment of your costs. For medical costs, you will have 45 days after the start of treatment to submit written proof to your insurance company that details the nature and extent of the injuries and treatment received. New York no-fault insurance policies allow you 90 days to submit written proof of your lost earnings. It is best to submit these as quickly as possible, since your insurance company is not required to pay out until it receives your forms. Once it does receive them, however, the insurer will have 30 days to pay you. Your insurer may ask you to submit more proof or more details, typically to ensure the claim is not fraudulent.

What If You're Asked for an IME?

According to New York law, insurers can require policyholders to undergo an IME, or independent medical exam, before they'll pay no-fault insurance claims. If you refuse to take the IME, your insurer can deny your no-fault claim and you would have to go to arbitration to overturn the ruling. Not every person who files a no-fault insurance claim will be asked to take an IME, but it's more likely if you're claiming particularly severe injuries that would be a high cost to treat. Your insurer will want confirmation from someone besides your personal doctor that the extent of the injuries matches what you've stated.

New York State No-Fault Claim Forms

When you notify your insurer that you've been in an accident and want to file a PIP claim, you'll be asked to complete multiple forms. There are three forms you should be familiar with when filing a no-fault insurance claim in New York, as they lay out the key information regarding how your insurance payments are spent.

  • NF-2 form: The NF-2 form, or Application for No-Fault Benefits, is the document where you'll clarify what happened, state that you're submitting a PIP claim and describe the extent of your known injuries.
  • Assignment of Benefits (AOB) form: If you've found a medical professional for treatment, you can use the NY Assignment of Benefits form to direct your PIP insurance benefits to them. You'll submit this form to your insurer, and the physician receives compensation for treatment directly instead of billing you. Even if your insurer denies a cost because the treatment wasn't determined to be necessary, your physician would not be able to pursue you for payment.
  • NF-3 form: Your physician or health care provider will fill out the NF-3 form, but it's good to be familiar with it because it contains the record of treatment provided to your insurer. The NF-3 should be submitted to your PIP insurance company within 45 days of treatment and will contain details such as your identifying information, claim number, diagnoses and details of treatments. The form also lists the costs of each treatment and the health care provider's details, and it restates some of the information from the forms above.

Limitations of New York's No-Fault Insurance Law

If you've filed a PIP claim and also want to file a liability claim against the at-fault driver in an accident, perhaps because you've had extremely costly injuries, you may be restricted. Because New York is a no-fault state, you're only allowed to file a liability claim against another driver if you meet the serious injury criteria laid out in Section 5102(d) of New York's insurance law, which includes the following.

  • Death
  • Dismemberment, serious disfigurement or a fracture
  • Loss of a fetus
  • Permanent or significant limitation of use of a body organ, function or system
  • Significant disability for at least 90 days

Assuming your case meets the serious injury standards, you would typically have three years in which you could file a personal injury lawsuit against the other party, as this is New York's personal injury statute of limitations.

How Much Does New York PIP Cost?

New York does not give consumers many ways to reduce no-fault insurance costs like in other states. You may select a higher deductible, such as $200, which will lower premiums slightly, but you cannot coordinate the coverage with your health insurance as in the case of New Jersey and Michigan. If you feel the $50,000 won't be enough coverage, you can also buy optional basic economic loss insurance (OBEL) as well as additional PIP coverage that will increase your limits. The cost of PIP insurance varies based on your driving history and location—so NYC residents may pay a different rate than those in Albany. Below are a few sample car insurance quotes for two types of drivers.

DriverDeductible OptionPIP/Full Policy Price
30-year-old single maleNo deductible$112/$1,078
$200 deductible$109/$1,074
45-year-old married coupleNo deductible$140/$1,212
$200 deductible$137/$1,209
Optional basic economic loss$12
Additional $50,000 PIP$16

The $200 deductible ultimately does not do much to reduce no-fault insurance costs. The average difference between opting in and opting out of the deductible is only $3.50. It may just be better to go without the deductible, depending on your budget. If you have to use your PIP insurance, the deductible wouldn't save you enough money to justify the $200 out-of-pocket expense. OBEL and additional PIP are relatively cheap, costing less than $30 more per year for an extra $75,000 worth of coverage.

Should You Get Optional Basic Economic Loss (OBEL) and/or Additional PIP Benefits?

New York no-fault regulations require one of the higher minimum PIP limits in the country, so you may question whether you need extra coverage. Medical costs from a car accident can become expensive, so it may be easy to reach your limits. However, if you have good health insurance, you should be able to pay for the rest of your expenses through that. OBEL is particularly helpful, however, when it comes to getting more benefits for lost earnings. OBEL gives you an additional $25,000 worth of no-fault insurance benefits that you can allocate toward medical expenses, earnings losses, psychiatric or rehabilitative costs, or a combination of the former two options.

OBEL may be useful when you remember that earnings loss benefits are subject to a maximum of $50,000 (or about two years' worth of benefits because you get $2,000 per month). Two years is a long time to be disabled, so you might not need that much coverage for lost earnings. But if your medical costs climb to $40,000, for example, that leaves you only $10,000 left of your PIP coverage. The $10,000 will cover five months' of lost earnings, and a particularly severe injury may keep you out longer than five months. Considering the cost of OBEL is less than $15 per year, it may be worth it to include on your policy, just in case. If you have good health insurance, buying even more PIP insurance may be superfluous.

Comments and Questions