Dallas Fort Worth Insurance Lawyer Blog

An insurance policyholder in Southlake, Grapevine, Grand Prairie, Arlington, Fort Worth, Mansfield, Burleson, Crowley, or anywhere else in Texas may ask the same question; Who gets the personal injury protection (PIP) monies. It is estimated that only ten per cent of automobile policyholders purchase PIP benefits as an option when they purchase their auto insurance policy. It costs extra, and lots of people just do not want to pay the extra money for this benefit.
The Texas Insurance Code, Section 1952.152, mandates that PIP coverage be offered to any purchaser of auto liability coverage. Section 1952.153, mandates that the minimum amount of coverage for PIP is $2,500. Some insurance companies will offer up to $100,000 of PIP coverage.
Section 1952.155 mandates that this coverage be provided without regard to fault in the accident or any other event that the coverage provides for. The PIP benefits are payable without regard to fault or other sources of insurance coverage. This same section of the Insurance Code states that an insurance company paying benefits under PIP coverage does not have a right of subrogation or claim against any other person or insurance company to recover any benefits by reason of the alleged fault of the other person in causing or contributing to the accident.
So, what does all this mean? First, it means that you should seriously consider talking with an experienced Insurance Law Attorney to make sure you do not handle this in an improper manner and find yourself being sued for not handling it properly. There are liens, subrogation interests, and assignments that may exist that most people are not aware of or think about, that could put a person in a position of being sued when these other interests are not properly acknowledged and / or dealt with.
In the normal car wreck situation involving injury, the injured person will often times have a health insurance plan that pays the injured persons medical bills. These bills may be paid by a private health plan such as one administered by Blue Cross / Blue Shield, Humana, or any number of other private insurers, or the bills may be paid for by a government plan such as Medicare, Medicaid, Veterans Administration, etc. Most of these plans are going to require that they be paid back or reimbursed when the injured person recovers money from some other source or third party, usually the insurance company for the person who caused the injuries.
The Federal case out of the Western District of Wisconsin, styled, Allen v. United States, decided in 1987, makes it clear that the PIP monies are not to be used to reimburse the medical provider. In the Allen case, the Veterans' Administration, (VA) paid benefits on behalf of Allen. Allen's insurance company, USAA, tried to pay $130,000 to the VA as reimbursement for medical expenses. Allen sued to protect these monies from the VA subrogation and won.
The Court in its opinion stated that the subrogation interest of the VA was limited to Allen's recovery from third parties who caused the injuries, not Allen's own insurance company benefits that were monies payable without regard to liability or fault, such as PIP.
This can be confusing, not only to the policyholder, but also to the insurance company who handles these types of situations on a daily basis across the nation. This is further complicatd by new policies and laws being written that sometimes do allow recovery of some of these "no fault" insurance coverages, such as PIP.
The worst case scenario is that when these situations are not handled properly an unknowing policyholder may find themselves on the losing end of a lawsuit that could end up costing lots of money.

Policyholders in Grand Prairie, Arlington, Mansfield, Fort Worth, Weatherford, Aledo, Azle, or any other city in Texas who have one of the coverages listed above would want to know how those coverages work if they are in a situation where the coverages may apply. A case decided by the Texas Supreme Court in 1999, gives some insight into how these types of claims are handled.
The court actually decided two cases together. They are Mid-Century Insurance Company of Texas v. Jack Kidd, and the other is Nationwide Mutual Insurance Company v. Catherine Gerlich.
The issue in both cases revolved around how PIP benefits were paid when a claim was being made against the liability portion of the same policy.
To begin with, in order to make sure that a policyholder is being treated properly, they should consult with an experienced Insurance Law Attorney. Putting that aside, and rather than getting into the specifics of each case, lets assume the following scenario:
A policyholder has PIP coverage of $2,500 and liability coverage of $20,000. The policyholder is involved in an accident wherein he has injuries and resulting medical bills and lost wages that exceed the limits of both coverges.
The question before the court was whether or not Mid-Century Insurance Company of Texas (Mid-Century) and Nationwide Mutual Insurance Company (Nationwide) only had to pay the policy limit on the larger coverage or pay the limits on both coverages. Mid-Century and Nationwide argued that they only had to pay one limit.
Without gettting into the logic of their decision, which is a good read for understanding how it works, the court's ruling was essentially this:
1) PIP is payable up to its limits;
2) the liability portion of the policy gets an offset for the monies paid under the PIP portion of the policy; and
3) where the PIP limits and the liability limits are less than the total damages, the limits of both are payable.
Using the courts ruling the policyholder would be able to recover a total of $22,500 per the above scenario.
In a second scenario assume the limits are the same but the total damages are only $14,000. In this second scenario, the injured person would be entitled to the $2,500 in PIP but only $11,500 in liability because the liability portion of the policy gets an offset for the benefits paid by the PIP portion of the policy.
The Texas Insurance Code Section 1952.159 helps explain the above to a certain degree. It says;
If a liability claim is made by a guest or passenger described by Section 1952.151 against the owner or operator of the motor vehicle in which the guest or passenger was riding or against the owner's or operatior's liability insurer, the owner or operator of the motor vehicle or the owner's or operator's liability insurer is entitled to an offset, credit, or deduction against any award made to the guest or passenger in an amount equal to the amounts paid by the owner, the operator, or the owner's or operator's automobile liability insurer to the guest passenger under personal injury protection.
This law was enacted in 2005 in response to the Supreme Court's Mid-Century decision.
How this works is not really all that confusing to an attorney familiar with it, but can be very confusing the first time it is encountered.

Substantially less than half the automobile drivers in Mansfield, Dallas, Fort Worth, Arlington, Grand Praire, Weatherford, or any other place in the State of Texas carry Personal Injury Protection (PIP) benefits on their automobile insurance policy. Dollar for dollar it is one of the more expense insurance benefits a person can purchase.
PIP covers losses for medical bills and lost wages that are incurred for incidents arising out of the use of a covered automobile. This requirement is set out in the Texas Insurance Code, Section 1952.151. It is required to be offered on all automobile insurance policies issued in the state of Texas. This requirement is found in Section, 1952.152.
This purpose of this article is to help the reader understand Texas Insurance Code, Section 1952.155 and to tell the reader that the law in this section is enforced by holdings in the Texas Supreme Court. It states some of the Texas law dealing with PIP. The title of this section is, "Benefits payable without regard to fault or collateral Source; Effect on Subrogation."
The section starts out:
(a) The benefits under coverage required by this subchapter are payable without regard to:
(1) the fault or nonfault of the named insured or recipient in causing or contributing to the accident; and
(2) any collateral source of medical, hospital, or wage continuation benefits.
Ok, what does (1) and (2) mean? One means that PIP benefits are payable no matter who is at fault in causing the loss. So regardless of who caused the injury, you or some other person, PIP will pay benefits. Number two means that the PIP benefits are payable even if you already had a medical benefits plan pay your bills or a hospital benefits plan already paid the bill. And it pays lost wages even if you had some other disability or other type of wage loss plan pay the lost wages. Both these essentially mean that a person could legally get a "double recovery" This is the only place in Texas law where this is a possibility.
Next, this section says:
(b) Except as provided by Subsection (c), an insurer paying benefits under coverage required by this subchapter does not have a right of subrogation or claim against any other person or insurer to recover any benefits by reason of the alleged fault of the other person causing or contributing to the accident.
This part (b) means that if you receive PIP benefits and it is determined that some other person was at fault for causing the injury or loss, then your the insurance company cannot attempt to recover from the other person or his insurance company any monies that have been paid to you.
The last section says:
(c) An insurer paying benefits pursuant to this subchapter, including a county mutual insurance company, shall have a right of subrogation and a claim against a person causing or contributing to the accident if, on the date of the loss, financial responsibility as required by Chapter 601, Transportation Code, has not been established for a motor vehicle involved in the accident and operated by that person.
So this section (c) is an exception to (b) in that if another person causes the accident, and the other person does not have the liability insurance required under Texas law, then the insurance company providing the PIP benefits can pursue the at fault person for the monies paid on the PIP claim.

Anytime a person buys insurance coverage for their automobile in Texas, they are given many options. These options include choices related to collision coverage, coverage for towing, rental cars, and even life insurance, to mention a few. No matter where you buy automobile coverage in Texas, whether it is Dallas, Fort Worth, Arlington, Grand Prairie, or in Weatherford , you are also given the option to buy uninsured / underinsured beneits and personal injury protection benefits also known as PIP.
In discussing PIP coverage, one should know that this coverage is regulated in the Texas Insurance Code, Sections 1952.151 thru 1952.161.
Section 1952.151 says that PIP provides payment of all reasonable expenses that arise from an accident for: A) necessary medical care, B) lost income for a wage earner, and C) reinbursement for reasonable expenses for essential services ordinarily performed by the injured person. An example of this last one would be reinbursing an injured person for having to pay someone to mow his yard because his injuries prevented him from doing it himself.
Another important thing to realize about PIP coverage is found in Section 1952.152. This section says an insurance company must provide PIP coverage in any and all polices issued in the State of Texas. This coverage is automatic unless the named insured rejects the coverage in writing.
Section 1952.153 requires that the minimum for PIP coverage be $2500. There is not a maximum required by law. A maximum is left to the discretion of the insurance company.
Section 1952.155 is another important part of PIP law. This section says that PIP benefits are payable without regard to the fault of a person seeking coverage. Also, this section says PIP is payable without regards to whether or not there is other insurance to cover the loss. In other words, this section actually allows for a "double recovery".
Section 1952.156 deals with time limits for presenting the claim for PIP benefits and the time frame for the insurance company to pay these benefits.
Section 1952.157 provides for the penalties an insurance company faces for not promptly paying claims under PIP benefits.
Another relevant section is Section 1952.159. This section allows an offset against a liability claim. This normally applies to a situation where a passenger is injured due to an insured drivers' negligence. The passenger would normally receive PIP benefits soon after an accident, then later on settle the liability claim against the driver. When the claim against the driver is settled under the liability portion of the settlement, the insurance company can take a credit or offset against the monies paid under the PIP portion of the policy.
PIP is a valuable coverage to be able to make a recovery from. And it is important to know and understand the way PIP coverage works so as to insure an insurance company adjuster does not accidentally or deliberately handle the claim wrong. Seeking the advice of an experienced Insurance Law Attorney can insure that your claim for benefits is handled properly.