Will My Insurance Premiums Increase if I Use My PIP Coverage?

PIP, which stands for personal injury protection, is an extra coverage that people elect and pay for in their insurance premiums monthly. PIP is a no-fault coverage that helps pay your medical bills and lost wages regardless of who was at fault for the accident. When clients hire us, we explain the PIP process and how it works in detail.

The first question many clients ask is “will my insurance premiums increase if I use my PIP?” Generally, using PIP should not increase your insurance rates because it is a no-fault coverage that you pay extra for in your premiums, whether you pay monthly, or yearly. However, in practical application, we have sometimes seen insurance companies raise their insured’s insurance premiums when a PIP claim is asserted.

So that our clients are not blindsided by insurance companies increasing their insurance premiums as a result of a PIP claim being asserted, we frequently advise our clients to consult with their insurance agent to ask if their insurance company will raise their rates if a PIP claim is asserted. However, we seldom see our client’s rates being raised as a result of making a PIP claim.

Another question that is commonly asked is “will my insurance policy be canceled if I use my PIP?” The answer to this question is the same as above.

What Does Personal Injury Protection (PIP) Cover?

PIP insurance, sometimes called no-fault insurance, is a form of auto insurance coverage that pays for your medical and disability expenses, as well as those of your passengers, regardless of who was at fault for the auto crash. PIP insurance provides primary coverage, which means it may need to be used before your health insurance policy would kick in. Here are some of the medical expenses that PIP would cover:

  • Hospitalization expenses
  • CT Scan or radiology expenses
  • Surgery expenses
  • Physical Therapy expenses

In addition to medical expenses, personal injury protection insurance provides some death and disability benefits that you may not find through a Med Pay Insurance policy. For example, if you or a passenger were killed in a car collision, the PIP policy would cover funeral expenses. Or, if you were left unable to work due to injuries, the insurance would reimburse you for 85% of lost wages, up to the limits of the policy.

PIP insurance will only reimburse you up to your policy limits, which could be lower than the total cost of your medical bills.

For example, if you have $5,000 of personal injury protection, but the combined cost of your medical expenses and 85% of your lost wages is $20,000, your personal injury protection insurance could reimburse you for $5,000.00, but will not cover the $15,000.00 that exceeds your coverage limit.

What Is Excluded From PIP Coverage in Maryland?

Your PIP insurance won’t provide reimbursement for your car repairs or for any damage you cause to other people’s property. It only covers medical expenses and lost wages. Other notable exemptions from personal injury protection coverage include buses and taxis. If you are injured in a bus or taxi in Maryland, you will not receive PIP coverage under that vehicle’s insurance policy.

However, if you carry your own PIP coverage, you may still be able to file a claim, even though your vehicle was not involved in the auto wreck. Similarly, most insurance companies do not offer PIP coverage as part of their motorcycle insurance policies. However, if you are riding a motorcycle and are hit by another driver who carries personal injury protection coverage on their insurance policy, you may be able to file a PIP claim under their policy.

Limited Stacking Is Allowed in Maryland

A claimant who is a passenger can collect PIP coverage under the vehicle that they are in at the time of the accident. If their PIP coverage on their own policy has a greater limit, then they can claim that excess.

How Much Does PIP Insurance Cost in Maryland?

The total cost of your personal injury protection insurance may vary depending on factors such as your age, driving history, and the amount of coverage that you are wanting to get. The state of Maryland does not require you to carry PIP coverage, but auto insurance companies are mandated to offer a minimum of $2,500.00 of PIP insurance. If you add PIP benefits, we recommend comparing quotes from multiple insurance companies in order to get competitive rates.

How Will a PIP Claim Affect My Rates?

Maryland car insurance companies are barred from applying a rate surcharge to drivers who file PIP claims. So, a PIP claim will not affect your rates, and you should not hesitate to file a claim under your personal injury protection coverage. That is what you pay extra each month for; to have this coverage when needed after an auto car crash.

But keep in mind that other claims, such as one filed under your collision coverage, could increase your premiums. How much a claim might increase your rates is based on factors like the amount of fault you bear for an auto collision, the total amount of the claim and any previous claims within the past three years.

Drivers who file a claim often see rate increases between 23% and 33% of their base policy premiums. If you file multiple claims within three years, and you were at fault, you will likely see a drastic increase in your rates.

Who Is Covered by My PIP Insurance?

A typical PIP insurance policy covers the policyholder as well as any passengers in their vehicle, any authorized drivers of the insurance vehicle and any pedestrians hit by that car. Each person involved is entitled to the full personal injury protection policy limit, as long as they haven’t declined PIP coverage on their own auto insurance policies.

For example, say you carry $5,000 of PIP insurance and have two passengers in your vehicle, and you accidently hit a pedestrian. If every person involved is injured in the car collision, you are each entitled to $5,000 of PIP reimbursement for your medical expenses. However, if one of your passengers or the pedestrian has a vehicle registered in their name in the state of Maryland, and they declined PIP coverage on their own auto insurance policy, they are not entitled to any PIP benefits from yours. But the pedestrian would be entitled to file a claim under your liability insurance coverage, regardless of their own policy.

When purchasing an auto insurance policy in Maryland, you may choose to waive or accept PIP coverage for yourself, other names on the policy, as well as family members who are at least 16 years old and live in your home. If you decline the coverage, you must still select a coverage limit for passengers in your vehicle. The only people who may decline PIP coverage completely are those who meet each of the following criteria:

  • The policy you are applying for provides only the minimum liability coverage required in Maryland.
  • Prior to the application, you were insured by a company other than the Maryland Automobile Insurance Fund.
  • The insurer under the prior policy canceled the policy before the end of its term.

How to File a PIP Claim

We recommend contacting your insurance agent to initiate your claim as early as quickly as possible. They will help you understand how your benefits work and guide you through the claims process. PIP claims must be filed within one year of the accident. If you do not file your claim within one year, you may be denied coverage. Also, filing your claim right away will help you gain access to necessary reimbursement funds more quickly.

Regardless of whether you are submitting your personal injury protection insurance claim before or after you receive medical attention, you need to make sure you document evidence of all injuries, lost income and medical treatments to serve as proof to support your claim. Save all receipts or statements of medical services rendered, doctor’s note and photographs of your injury.

Finally, you may choose to take full advantage of Maryland’s collateral source rule to increase your claim benefits.

What Is the Collateral Source Rule?

Under Maryland law, the payment of a PIP claim by one insurance company does not preclude other individuals or institutions from liability, and your insurer can not recover from you any money paid by another source.

If you are injured by another driver and file a claim under your own PIP coverage to pay for your medical expenses, you may also file a claim with the at-fault driver’s liability insurance policy. If you receive a payment from the other driver’s insurance company, your own insurer can not recoup from you any personal injury protection payments made to cover costs related to your injuries.

Say you carry $2,500 of PIP insurance, and you are rear-ended by another driver. You incur $3,000 in medical expenses and $2,000 in recoverable lost wages. Filing a claim under your own personal injury protection policy, you could receive a maximum of $2,500 – half of your total expenses. However, you could also file a claim for the same expenses under the other driver’s liability insurance policy to gain an additional $5,000, bringing your total reimbursement to $7,500.

This can be critically important if you are unable to work for an extended period of time and your lost wages and medical expenses exceed your own PIP policy limit. However, it does not reduce the importance of having sufficient personal injury protection insurance coverage of your own, as you may incur high medical bills in an auto wreck for which you are at fault.


If you or a loved one has suffered a serious injury in an automobile collision or any type of accident and are seeking an exceptional team of auto accident attorneys who are experienced with PIP claims in the Baltimore area, and surrounding communities, please contact the Law Offices of Larry B. Litt for an immediate and free consultation. Take your first step towards protecting your legal rights and pursuing a successful settlement with the help of our dedicated attorneys. Call now: 443-844-1528, we are available anytime day or night.