What Is a PIP Deductible?
A PIP deductible is the amount that must be applied before an insurer pays PIP benefits. The deductible is selected by the named insured and is applied once per accident.
Whether a deductible exists, and the amount of that deductible, depends on the specific policy.
Who the PIP Deductible Applies To
The PIP deductible applies to all insured persons covered under the policy, including:
- The named insured
- A resident spouse
- Dependent resident relatives
The deductible elected by the named insured applies equally to each of these covered individuals.
Named Insured
The named insured is the person listed on the policy’s declarations page. This person is the primary policyholder and is responsible for coverage elections, including whether a deductible applies.
If the named insured receives treatment after a covered accident, the deductible is applied to PIP benefits that would otherwise be payable.
Spouse of the Named Insured
A spouse who lives in the same household as the named insured is generally covered under the policy, even if not listed on the declarations page. When covered, the same PIP deductible applies to the spouse’s benefits.
If spouses live separately, coverage may depend on policy language and the facts of the situation.
Dependent Resident Relatives
Dependent resident relatives may also be covered under the policy. This typically includes family members who:
- Are related by blood, marriage, or adoption
- Live in the same household
- Are financially dependent on the household
When covered, the deductible applies to their PIP benefits as well.
How the Deductible Is Applied
The PIP deductible is:
- Applied per accident, not per provider
- Applied to the first medical bill or bills received by the insurer
The order in which bills are received matters.
Simple Example
- PIP deductible: $1,000
- First bill received: $1,000
If the first bill received equals the deductible, the entire bill is applied toward the deductible. In that situation:
- The deductible is fully satisfied
- No PIP payment is made on that bill
- The provider submitting that first bill does not receive payment from PIP
Later bills may be eligible for payment once the deductible has been satisfied, subject to policy terms and PIP requirements.
Key Takeaways
- The deductible is chosen by the named insured
- It applies to the named insured, resident spouse, and dependent resident relatives
- It applies once per accident
- It is applied to the first bill(s) received
- A bill that equals the deductible may result in no PIP payment
Disclaimer: This content is general educational information and is not legal advice. Coverage determinations depend on policy terms and factual circumstances.
