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Car insurance in nj for medicaid insured

Is personal injury protection coverage mandatory?
What happens if I don’t have personal injury protection coverage?
Types of PIP-related coverage
What is a resident relative under personal injury protection coverage?
Resident relatives and their own insurance versus your personal injury car insurance
What is PIP fraud or no-fault fraud?

What does personal injury protection coverage do?

Admiral car insurance policyPersonal injury protection (PIP or MEDEX) pays a per-person benefit amount for injuries you (the insured), and others specified in your policy, sustain in an auto accident. Basic personal injury car insurance coverage is for the insured's own injuries on a first-party basis, without regard to fault.

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Parties typically covered by PIP include:

  • Policyholder
  • Policyholder’s relatives in the same household
  • Passengers (if they don’t have their own PIP coverage to place claim under)
  • Other authorized drivers of your insured vehicle
  • Policyholder and family members if they are injured while riding in someone else’s car
  • Policyholder and family members if struck by another vehicle when a pedestrian (in some states).

The exact benefits offered by PIP vary by state, and there may be a deductible due before the benefits kick in. Coverage varies widely among states, so the terms of your policy will note your specific benefits, but in general personal injury protection coverage includes:

  • Medical expenses – May include reasonable charges for medical, hospital, surgical, nursing, dental, ambulance and x-ray services. Necessary medications, medical supplies and prosthetic devices may also be covered.
  • Loss of essential services (also sometimes referred to as disability or replacement services) - Can receive benefits if you need help performing household or other tasks due to your injury.
  • Loss of income
  • Funeral expenses
  • Survivor’s loss – some policies compensate an individual’s heir(s) if the person died from accident-related injuries.

Your PIP limits set the maximum amount that will be paid per person for any combination of covered expenses. PIP limits vary by state; some states allow you to choose your PIP limits and others set it to a certain amount like $10,000, unless you choose to buy additional PIP coverage.

Is personal injury protection coverage mandatory?

Yes, in no-fault states, personal injury protection coverage is required (and is typically referred to as no-fault coverage). In other states, it’s optional, if available at all.

What states require personal injury car insurance?

There are 12 states that are considered no-fault and PIP coverage is required:

  • Florida
  • Hawaii
  • Kansas
  • Kentucky
  • Massachusetts
  • Michigan
  • Minnesota
  • New Jersey
  • New York
  • North Dakota
  • Pennsylvania
  • Utah

Three of these states, New Jersey, Pennsylvania and Kentucky, have “choice” no-fault laws. In these states you can retain your right to sue for auto accident injuries if you reject the lawsuit threshold. For this privilege you will pay a higher premium.

There are eight states that are not no-fault states but in which PIP can still be part of a policy. These states are not no-fault states and either require PIP coverage, require it to be offered though drivers can decline or offer it as optional coverage:

  • Arkansas
  • Delaware
  • District of Columbia
  • Maryland
  • Oregon
  • South Dakota
  • Texas
  • Washington

What happens if I don’t have personal injury protection coverage?

If this no-fault coverage is optional in your state and you choose to go without, when you are at-fault in an accident or the at-fault party cannot cover your injuries, you will need to have coverage such as medical payments on your policy or you may end up paying out-of-pocket for your medical bills.

If you have adequate health insurance and your state doesn’t require this coverage, then personal injury protection coverage may be unnecessary.

PIP-related coverage:

Additional personal injury protection is available in some states (and by only some carriers) where PIP is available. Additional PIP acts as a supplement to the PIP coverage required by your state. It allows you to raise your PIP maximum limit amount.

Extended personal injury protection is available in Florida where personal injury protection coverage typically pays 80 percent of medical expenses and 60 percent of lost wages. Purchasing extended PIP allows you to amend your PIP so that 100 percent of medical expenses and 100 percent of lost wages will be paid (up to the maximum limits of your PIP coverage). The Florida Department of Financial Services Insurance Library gives more information on increased PIP benefits.

Guest personal injury protection is available in Kentucky and provides coverage to guest passengers in your vehicles. It is required when all drivers on your policy have rejected no-fault coverage. (Kentucky is a choice no-fault state).

In states such as New Jersey, you have to choose a Personal Injury Protection Plan. Here is a description of those choices:

Full PIP Primary acts as the primary coverage for injuries sustained by you or your passengers in an auto accident. This option also covers income continuation, funeral expenses, death benefits, and essential services expenses.

Full PIP Health Primary should be purchased if another health insurance provider acts as the primary coverage for injuries sustained by you or your passengers in an auto accident. This option also covers income continuation, funeral expenses, death benefits, and essential services expenses, as detailed below.

Full PIP health primary coverage is not available if you use Medicare or Medicaid as your primary health insurance or if you are an active member of the military. In addition, some health insurers do not cover injuries related to car accidents. If you are unsure of what your health insurance covers, you should select full PIP primary or medical only PIP primary.

Medical Only PIP Primary acts as the primary coverage for injuries sustained by you or your passengers in an auto accident.

Medical Only Health Primary should be purchased if another health insurance provider acts as the primary coverage for injuries sustained by you or your passengers in an auto accident.

Medical only health primary coverage is not available if you use Medicare or Medicaid as your primary health insurance or if you are an active member of the military. In addition, some health insurers do not cover injuries related to car accidents. If you are unsure of what your health insurance covers, you should select full PIP primary or medical only PIP primary.

What is a resident relative under personal injury protection coverage?

The definition of a resident relative can differ depending upon state laws as well as the language (terms) of an auto insurance policy.

A typically insurance policy defines a resident as someone who has physical presence in your household with the intention to continue living there. Unmarried dependent children, while temporarily away from home, to attend college for example, are normally still considered residents if they intend to continue to live in the parents' household during breaks from the school year.

A relative is someone related to you, so a relative resident would be someone related to you who lives in your home.

For instance, Colorado defines a resident relative as a person who at the time of an accident is related by blood, marriage or adoption to the named insured or resident spouse, and who resides in the named insured's house, even if temporarily living somewhere elsewhere. The state also adds that any ward or foster child, who usually resides within the named insured's home, can be considered a resident relative.

Another example is from Maryland. The Maryland Appeals court had to consider what constitutes a resident relative for the purposes of an uninsured motorist coverage claim. In this case the plaintiff had been living with his grandmother for almost a year. When the plaintiff was in an accident, he wanted to use his parents' Uninsured Motorist coverage, saying he was a resident relative. The court, however, found that he could not be a resident relative of his parents who lived in a different town from the grandmother.

The court noted he was not a full-time student, lived with his grandparents for the 11 months preceding the auto accident and during that time only visited his parents' home approximately four to six times. So the court of appeals found he was not a "resident" of his parent's home as defined by their insurance contract with their carrier.

The court reasoned that according to the policy language the plaintiff would be a resident only if he physically lived in his parents' house, was under the age of 24 and attended school full-time.

Who will be considered a resident relative in regards to your personal injury protection (PIP) coverage will depend upon the definition of a "resident relative" your state has in place as well as the language of your policy regarding this term and your PIP coverages and exclusions.

In general, if you have a child that lives with you, then he or she would normally be considered a resident relative and be covered by your PIP insurance. If you had a child that moved out and lived on his or her own, then this child would not usually be covered as a resident relative any longer under your PIP coverage.

Resident relatives and their own insurance versus your personal injury car insurance

If your resident relative has his own insurance policy, your PIP coverages may not extend to him, depending again on state laws and your policy's terms. For example, in 2007 New Jersey courts decided that a plaintiff in a court case could not recover PIP benefits from both her own auto insurance policy and her mother's policy.

In this New Jersey court case, the plaintiff was involved in a car accident in which she sustained extensive injuries. She was operating her privately owned vehicle at the time of the accident and was insured by her own insurance company for $75,000 worth of PIP benefits. Her medical bills exceeded this amount. At the time of the accident, the plaintiff lived with her mother, who was the named insured on an automobile policy issued by a different insurance carrier and had PIP benefits of up to $250,000. Since the mother's limits were higher, she tried to place a claim with her mother's PIP policy for the medical bills in excess of her $75,000 PIP coverages of her own policy.

The mother's auto insurance policy extended coverage and PIP benefits to resident relatives, although subject to exclusions. One such exclusion was the denial of liability coverage and PIP benefits to resident relatives for injuries sustained as a result of an accident involving a vehicle owned by a resident family member. So, according to the terms of the mother's policy, the daughter was excluded from making her PIP claim since the accident took place in her own vehicle which had its own coverage.

New Jersey law section 39:6A-4.2 authorizes PIP benefits not only to the named insured but also to resident family members of the insured's household, provided the resident family members are not named under their own policies. This section of the statute also says that no person can recover PIP benefits "under more than one insurance policy for injuries sustained in any one accident."

To find out about your state laws with regard to resident relatives, check with your state's insurance regulator. For information on the language of your policy and the exclusions it may have, read over the terms of your policy, specifically the PIP portion.

What is PIP fraud or no-fault fraud?

PIP fraud is when a system is setup to illegally get payment for PIP claims from an insurance company on behalf of the policyholder.

One type of PIP fraud involves staging a fake car accident so that bogus injury claims are paid out through a person's PIP coverage. In this example, clinics are set up to sign off on the fake injuries, making it appear that the person was treated, so that both parties will receive money from the driver's PIP policy.

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New Jersey Car Insurance

When it comes to obtaining car insurance in New Jersey, you have options. New Jersey offers several avenues for you to fulfill the state's car insurance requirements. Read more to learn about rates, policy options, and how to get the best car insurance quotes in New Jersey.

Car Insurance Requirements in NJ

In order to comply with New Jersey's car insurance laws, you must choose a car insurance policy. Basic and standard policies are available; you should choose whichever policy best suits your insurance and financial needs.

Basic Policy

The Basic policy option is the more affordable insurance package; however, it offers limited coverage, including:

  • $5,000 of property damage liability (PDL) per accident. This covers damage you may have caused to someone's property in a car crash.
  • $15,000 of personal injury protection (PIP) per person, per accident. This coverage pays for injuries you suffer in a car crash.
  • Up to $250,000 for very severe injuries, such as permanent brain injuries.

NOTE: Bodily injury liability (BDL) coverage is not included in the Basic policy; however, policyholders are offered the option to purchase $10,000 of BDL coverage.

Standard Policy

The Standard policy option has a higher premium but offers more extensive coverage.

With the Standard policy, you get a minimum of:

  • $15,000 of bodily injury liability (BDL) insurance per person, per accident. This coverage will pay for injuries to anyone not in your car if you cause a car crash.
  • $30,000 of BDL for multiple injured people per accident.
  • $5,000 of PDL per accident.
  • $15,000 of PIP per person in a car accident.
  • Up to $250,000 of PIP for severe or permanent injuries.

Right to Sue

If you choose to purchase the Standard policy, you will have to make a decision on your right to sue if you are injured in a car accident.

Regardless of which right to sue option you choose, you will not be eligible to sue for medical expenses or loss of income, as both of those will be covered by your PIP; you can only sue for pain and suffering.

Unlimited Right to Sue

If you choose the unlimited right to sue option, you can sue a person who caused an accident you were injured in.

Because this is option offers broader rights to sue, it comes with a higher premium.

Limited Right to Sue

If you choose the limited right to sue option, you agree to only sue a person who causes a car accident if you suffer any of the following injuries:

  • Loss of a body part.
  • Significant disfigurement.
  • Significant scarring.
  • Displaced fractures.
  • Loss of a fetus.
  • Permanent injury.
  • Death.

The limited right to sue option is the more affordable of the right to sue options, and is the only option available in the Basic policy plan.

PIP and Health Insurance

You have the option of making your health insurance the primary source of medical insurance after a car accident. If you are on Medicaid or Medicare, this option is not available to you.

If you choose to have your health insurance as your primary insurance over personal injury protection (PIP), your health insurance will pay for your medical care after an accident up to your policy's limits. Your PIP will help pay for further costs.

Choosing this option will lower your car insurance premium. However, before you make this decision, make sure your health insurance covers injuries due to car accidents.

You might also want to compare your health insurance deductible - the part of your insurance coverage you are responsible for - to your PIP deductible.If your health insurance deductible is higher, then consider making your PIP your primary source of insurance for accident-related medical expenses.

Optional Car Insurance

In addition to the Basic and Standard car insurance options, most New Jersey auto insurance carriers also offer the following optional types of coverage:

  • Comprehensive – This coverage protects you against damages done to your car that do not involve car accidents, such as vandalism or damage caused by bad weather.
  • Collision – This coverage will help pay for damages to your car that result from an accident with another moving car.
  • Towing and labor coverage.
  • Rental car coverage.

NOTE: Comprehensive and collision coverages are not required by New Jersey law; however, if you're paying a car loan or lease, your finance company will require you to purchase these types of coverage.

Special Automobile Insurance Policy

If you are enrolled in Federal Medicaid with hospitalization, you are eligible for New Jersey's Special Automobile Insurance Policy (SAIP), which helps people who might not be able to afford standard car insurance purchase a low-cost car insurance policy.

Through SAIP, you will only be covered for medical costs after a car accident.

An SAIP car insurance policy costs $365 per year if you choose to pay in 2 installments, or $360 per year if you pay for the entire year up front.

You can apply to SAIP through most New Jersey car insurance companies, but if you would like help, you can call the Personal Automobile Insurance Plan (PAIP) at (800) 652-2471.

Car Insurance Fraud in New Jersey

New Jersey takes insurance fraud very seriously. Possible car insurance fraud may involve:

  • Faking injuries after a car accident.
  • Medical professionals overcharging for treatment of injuries.
  • Staging car crashes.
  • Making or having false car insurance ID cards.

Fines and Penalties

Car insurance fraud convictions can lead to:

  • Jail time.
  • Up to $15,000 in fines.
  • Suspension of driver's license.

Reporting Car Insurance Fraud

If you know of any suspected car insurance fraud, you can report tips to the New Jersey Office of the Insurance Fraud Prosecutor (OIFP):

  • Online using the OIFP Fraud Reporting Form.
  • By phone through the OIFP hotline at (877) 553-7283.
  • By mail: NJ Department of Law and Public Safety Division of Criminal Justice Office of the Insurance Fraud Prosecutor P.O. Box 094 Trenton, NJ 08625-0094
  • Via email at NJInsuranceFraud@njdcj.org.

Rewards Program

The OIFP offers a rewards program for individuals who report fraud, but only if the tip leads to an arrest and criminal conviction. Also, in order for the reward to be payable, the tip must be new, meaning the case cannot already be under investigation.

If submitting a reward application, you must do so within 30 days of your original notification of fraud to the OIFP in order to be eligible to receive the reward.

Car insurance fraud affects everybody with car insurance. You can help keep car insurance premiums down by reporting any possible instance of car insurance fraud.

Most Stolen Cars in New Jersey

You may face higher car insurance rates if you own a car that is highly targeted for theft.

The following are the most stolen cars in New Jersey for 2013, according to www.nicb.org:

  1. Honda Accord.
  2. Honda Civic.
  3. Dodge Caravan.
  4. Jeep Cherokee/Grand Cherokee.
  5. Ford Pickup (Full Size).
  6. Toyota Camry.
  7. Nissan Altima.
  8. Ford Econoline E250.
  9. Nissan Maxima.
  10. Toyota Corolla.

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California's Low Cost Auto Insurance Program

Made part of California law in 1999, California's Low Cost Automobile Insurance Program (CLCA) is designed to provide liability car insurance at affordable rates to income-eligible drivers.

To qualify for the CLCA, you must:

  • Meet income eligibility requirements.
    • Income eligibility* depends on the number of people in your household and the combined income of all members of the household.
  • Have a good driving record.
  • Be at least 19 years old.
  • Have a current valid driver's license.
  • Own a car:
    • Valued at $20,000 or less.
    • With no unpaid loans.

Annual premiums vary from county to county but the highest premium is capped at $388.

Coverage limits provided by the CLCA are lower than the CA's standard minimum requirements for car insurance. However, drivers in the program are exempt from meeting those requirements.

CLCA coverage limits are as followed:

  • $10,000 for bodily injury or death per person.
  • $20,000 for total bodily injury or death when multiple people are hurt in an accident.
  • $3,000 for property damage.

* To check your eligibility and find out the premium rates in your county, visit the CLCA website.

New Jersey's Special Automobile Insurance Policy

The Special Automobile Insurance Policy (SAIP) is New Jersey's initiative to help provide car insurance to low-income drivers.

You can apply to SAIP through most insurance agents in New Jersey.

To be eligible for SAIP you must:

  • Currently be enrolled in Federal Medicaid with Hospitalization.
  • Have a current valid driver's license.

Your SAIP premium will be:

  • $360 per year if you pay up front.
  • $365 per year if you pay in two installments.

SAIP covers your emergency treatment immediately following a car crash, in addition to costs related to serious brain or spinal cord injuries up to $250,000.

SAIP does not provide you with liability auto insurance coverage, or other medical costs that would be covered through Medicaid.

If your Medicaid is canceled during coverage, you may keep your policy, however, you will not be able to renew a SAIP policy once your current policy has expired.

For more information about New Jersey's Special Automobile Insurance Policy, visit the New Jersey Department of Banking & Insurance website.

Hawaii's Low Cost Disability Auto Insurance Program

According to Hawaii state law, any driver or person unable to drive due to permanent disability who receives public assistance involving direct cash payments may receive free personal injury protection and liability insurance from the state.

For more information, contact the Hawaii Department of Commerce and Consumer Affairs.

Shopping Around for Car Insurance

Regardless of your state's low cost program, getting multiple quotes for car insurance, whether online or by phone, will help you find the best policy at the best price.

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