PIP benefits explained: medical bills, lost wages and services

Personal injury protection pays four kinds of loss when you are hurt in a crash, whoever caused it: medical expenses, lost income, the cost of hiring someone to do jobs you can no longer do, and death or funeral costs. Each kind has its own rules, its own cap and sometimes its own waiting period, and all of them usually sit under one overall limit. The dollar figures are set by state law and by the limit on your policy, so the same crash can produce very different checks in Florida, New York, Pennsylvania and Michigan.

This article takes the coverage one bucket at a time. For the basics of which states require PIP at all, start with the PIP guide; here the question is what each bucket actually pays and how the pieces fit together. Statutes cited below were read in November 2026, and legislatures amend them, so confirm the current text for your state.

How PIP is organized

PIP is a first-party coverage: you claim against your own policy, not the other driver's. In a true no-fault state that comes with limits on suing for pain and suffering. In an add-on state the benefits are paid on top of the ordinary right to sue. The Insurance Information Institute's background on no-fault insurance describes the common shape: benefits can include medical fees, lost wages, funeral costs and other out-of-pocket expenses, and the main variations are the dollar limits on medical and hospital expenses, funeral and burial costs, lost income and the amount paid to a person hired to perform essential services for an injured non-earner.

Most policies express that as a single per-person limit, such as $10,000 in Florida or $50,000 in New York, that every bucket draws from. A few states split the coverage into separate limits for medical, income loss and death. Your declarations page shows which design you have.

Bucket one: medical expense benefits

Medical benefits pay for treatment that is related to the crash and medically necessary. The statutes differ on what is covered and, more important, on how much a provider may charge.

Florida. The statute pays 80 percent of reasonable expenses for medically necessary medical, surgical, X-ray, dental and rehabilitative services, including ambulance, hospital and nursing care, but only if you receive initial care within 14 days of the crash. Insurers may pay under a fee schedule: for most outpatient services, 200 percent of the Medicare Part B allowable amount, with the insurer paying 80 percent of that schedule. A provider who is paid under the schedule cannot bill you for the difference, apart from the share the policy does not pay and amounts above the policy limit. The Florida Statutes, section 627.736, spell all of this out, and the Florida 14-day article covers the deadline in detail.

New York. The mandatory endorsement lists necessary medical, hospital, surgical, nursing, dental, ambulance, X-ray, prescription and prosthetic services, psychiatric care, physical and occupational therapy and rehabilitation, and other professional health services. Payments follow the fee schedules under Insurance Law section 5108. There is no time limit on medical expense as long as it is ascertainable within one year of the accident that further expenses may arise, according to the prescribed endorsement text in 11 NYCRR 65-1.1.

Pennsylvania. The law requires every policy to carry at least a $5,000 medical benefit, and insurers must also offer higher medical limits and extraordinary medical benefits above $100,000. Providers may not collect more than 110 percent of Medicare-based amounts, or their usual and customary charge if lower. The statute also sends challenges to the reasonableness or necessity of treatment to a peer review organization. The text is in 75 Pa.C.S. 1711, 1712 and 1797.

Michigan. PIP pays allowable expenses, defined as reasonable charges for reasonably necessary products, services and accommodations for an injured person's care, recovery or rehabilitation. MCL 500.3107 excludes hospital room charges above a reasonable semiprivate rate unless intensive care is needed. Michigan also has a statutory fee schedule and attendant-care rules, which our Michigan PIP article covers.

The practical lesson is the same everywhere. The limit on the policy is not the amount of the bill; it is the amount left after the fee schedule has reduced the bill. A $4,000 hospital charge can use far less than $4,000 of the limit.

Bucket two: work loss

Work-loss or income-loss benefits replace part of the pay you cannot earn because of the injury. They are almost never 100 percent.

• Florida pays 60 percent of lost gross income and loss of earning capacity, and the statute requires disability benefits to be paid at least every two weeks. The Florida text I read sets no separate waiting period.
• New York pays lost earnings up to $2,000 a month for no more than three years from the date of the accident, and first-party benefits are reduced by 20 percent of lost earnings. If your employer keeps paying you, those payments generally reduce what PIP owes unless your income or future benefits are actually reduced. See Insurance Law 5102 and the endorsement text above.
• Pennsylvania insurers must offer income-loss coverage of 80 percent of actual gross income loss, and income loss does not begin until five working days have been lost after the accident. The statute also lets a self-employed person claim reasonable costs of hiring a substitute.
• Michigan pays work loss for the first three years after the accident, reduced by 15 percent because the benefit is not taxable, unless the claimant proves a smaller tax advantage. Benefits plus income you earn in the same 30 days cannot exceed a statutory monthly maximum, which the legislature fixed at $5,189 for October 2012 through September 2013 and requires to be adjusted annually. A person 60 or older who would not qualify for work loss may waive it for a lower premium.
• New Jersey treats income continuation as an extra benefit. The state's 2026 consumer guide lists it with essential services, death and funeral benefits under the "Extra PIP package" available with a standard policy.

Two choices can quietly shrink this bucket. Florida insurers must offer an exclusion of the lost-income benefit for a lower premium, and the statute's required notice advises a named insured not to take it if the insured or dependent resident relatives are employed (section 627.739).

Bucket three: essential services

Essential-services benefits pay for work you would have done at home without pay, such as cleaning, yard work, snow shoveling or child care, so they matter most to retirees, students, full-time caregivers and anyone whose injury hits the household more than the paycheck.

• Michigan pays up to $20 a day, reasonably incurred, for ordinary and necessary services you would have performed for yourself or a dependent, for up to three years.
• New York folds replacement services into work loss (the $2,000 monthly ceiling) and separately pays other reasonable and necessary expenses up to $25 a day for one year.
• Florida includes the cost of obtaining others' services "in lieu of" what you would have done without income for your household inside the disability benefit, so it competes with your wage claim and the $10,000 limit.
• New Jersey lists essential services as one of the extra PIP coverages, described in the state consumer guide as paying for necessary services such as cleaning the house, mowing the lawn, shoveling snow or doing laundry.

Keep receipts and a log. Insurers pay for services that were actually bought or arranged; a relative's unpaid help may or may not qualify depending on the policy language, so ask before assuming.

Bucket four: death and funeral benefits

These are smaller but often forgotten.

• Florida pays a $5,000 death benefit in addition to the $10,000 medical and disability limit.
• New York pays $2,000 to the estate of an eligible injured person who dies, in addition to the $50,000 basic economic loss, according to Insurance Law 5103 and the endorsement.
• Pennsylvania requires insurers to make accidental death benefits of at least $25,000 and funeral benefits of $2,500 available for purchase (75 Pa.C.S. 1715), which means the amount in force depends on what the policyholder bought.
• Michigan allowable expenses exclude funeral and burial costs above the amount set in the policy, which cannot be less than $1,750 or more than $5,000.

State-by-state at a glance

Check this table against your own policy. Insurers may offer more than the statutory minimum and the limits you chose may differ.

A worked example: how a $10,000 limit runs out

The numbers here are invented to show the mechanics in Florida, where the limit is $10,000. Say Priya is hurt as a passenger in her friend's car and gets care within 14 days of the crash.

1. Medical, first round. The emergency room, imaging and a first specialist visit produce $9,000 of charges that fit within the fee schedule. PIP pays 80 percent: $7,200. Priya owes the other $1,800 unless other coverage picks it up.
2. Lost income. She misses three weeks and loses $3,000 of gross pay. PIP pays 60 percent: $1,800. Running total: $9,000.
3. Therapy. Six weeks of physical therapy are billed at $2,000 within the schedule. At 80 percent, PIP would owe $1,600, but only $1,000 of the limit remains. PIP pays $1,000 and the limit is exhausted.

Out of $14,000 in total losses, PIP paid $10,000 and Priya is left with $4,000: $1,800 of coinsurance on the first round of care, $1,200 of unpaid wages, and $1,000 of therapy that arrived after the limit was gone. Her next sources are health insurance, medical payments coverage if she has it, or a liability claim against an at-fault driver. If she had chosen a $500 deductible to cut her premium, it would come off first: the statute applies the deductible to 100 percent of expenses and losses, and after it is met she can still receive up to $10,000.

For New York, take a different angle. Say Marcus earns $4,000 a month and misses three months. His loss is $12,000, but work loss is capped at $2,000 a month, so $6,000 is the most PIP can pay for lost earnings, whether or not the 20 percent reduction is applied first. The remaining $44,000 of the $50,000 limit stays available for medical care, which is why New York's design gives injured people room that a $10,000 limit does not.

PIP, health insurance and Medicare

When more than one payer could cover a bill, the order is set by state law.

• In Florida, PIP benefits are primary, except that workers' compensation payments are credited against them, and if Medicaid pays, the insurer repays Medicaid within 30 days.
• In Pennsylvania, section 1719 makes the auto policy primary and treats health-plan and similar benefits as excess of the first-party benefits, so the auto policy pays first.
• In New Jersey, a driver can choose the "health care primary" option for a lower premium. The state guide says Medicare and Medicaid cannot be used for that option, so check with your health plan before choosing it. Our New Jersey health-primary article explains the trade-offs.
• In Michigan, an insurer must offer an exclusion for PIP medical benefits tied to qualified health coverage for policies issued or renewed after July 1, 2020, and a person subject to the exclusion is not eligible for PIP medical benefits under that policy (MCL 500.3109a).
• Medicare can pay secondary to no-fault insurance, according to the Centers for Medicare & Medicaid Services, which asks beneficiaries with a pending no-fault claim to report it to the Benefits Coordination & Recovery Center. Federal regulation 42 CFR 411.50 treats personal injury protection and medical payments coverage as no-fault insurance for this purpose. Our guide on Medicare and crash medical bills goes further.

Who qualifies

PIP follows the person, not just the car. Florida's statute extends it to the named insured, resident relatives, people operating the insured vehicle, passengers, and pedestrians struck by it. New York's section 5103 covers people outside other vehicles who are hurt by the insured vehicle, plus the named insured and household members in several situations. Pennsylvania sets an order of priority: your own policy if you are a named insured, the household policy if you are an insured, the policy on the vehicle you occupy, and for a pedestrian the policy on a vehicle involved. Pennsylvania also bars an owner of a registered vehicle who has no financial responsibility from first-party benefits.

Exclusions exist everywhere. Florida allows insurers to exclude injuries from intentional self-harm and injuries suffered while committing a felony; New York allows exclusions for intoxication or impairment, felony, racing and certain other conduct, though emergency hospital services cannot be excluded for impairment.

What PIP does to your lawsuit

You generally cannot be paid twice. Florida says an injured party who can sue has no right to recover damages for which PIP was paid or payable, and the insurer has no lien on the tort recovery. Pennsylvania's section 1722 similarly precludes recovery of benefits paid or payable. New York works differently: its endorsement and Insurance Law 5104(b) give the insurer a lien on a recovery against a person not covered by the no-fault system. That is why settlement paperwork should be reviewed for PIP reimbursement; see our article on releases and liens.

Questions to ask your insurer

1. What is my overall PIP limit and is it shared by medical, income loss and services?
2. Did I choose a deductible, a work-loss exclusion or a health-insurance-primary option?
3. Is the fee schedule written into my policy, and does it apply to my providers?
4. Does my policy include a death or funeral benefit separate from the limit?
5. Who in my household is covered, and is anyone excluded?

Common questions

Does PIP pay if I caused the crash?

Yes. PIP is paid regardless of fault, which is its purpose. Your fault can matter for other coverage and for any lawsuit, but not for the basic benefits.

Is PIP the same as medical payments coverage?

They overlap but are not identical. MedPay usually covers medical and funeral expenses only, while PIP in many states also covers lost income and services. See MedPay or health insurance.

Can a passenger in my car claim on my PIP?

In Florida and New York, passengers in the insured vehicle are generally eligible, subject to the statutes' exclusions and priority rules. Check your state's rules with the state requirements lookup and your regulator.

What happens after the limit is used up?

Your health insurance, MedPay, disability coverage or a claim against an at-fault driver is next. In a no-fault state you may need to meet the lawsuit threshold first; see no-fault vs at-fault states.

Key takeaways

• PIP has separate buckets (medical, income, services, death and funeral), and most share one overall limit.
• Fee schedules shrink bills before the limit is touched; income benefits pay only a share of pay.
• Elections for deductibles, work-loss exclusions and health-insurance-primary options lower the premium and the benefit.
• Order of payment among PIP, health insurance and Medicare is set by state law; read yours before choosing options.
• Confirm numbers with your policy and your state's regulator; they change.