Her Medical Bills Hit $42,000. Her PIP Capped at $10,000, and She Could Not Sue.

*7 min read · Last updated June 26, 2026*

In this article

– What personal injury protection actually pays – Why no-fault states limit your right to sue – The minimum-limit trap – How to set a PIP limit that protects you – Frequently asked questions

Tasha Reyes was stopped at a light in Florida when a distracted driver hit her from behind at speed. Her injuries required surgery and months of physical therapy, and the bills reached $42,000. She assumed the at-fault driver’s insurance would cover it. Instead, her own personal injury protection paid first, and it capped at $10,000, the state minimum she had carried for years. When she tried to sue the other driver for the rest, her attorney explained that Florida’s no-fault law blocked the lawsuit unless her injury cleared a legal threshold. She was left holding most of a $42,000 bill.

PIP is one of the most misunderstood lines on an auto policy. In the states that require it, it changes who pays and whether you can sue at all, and the limit you choose quietly decides how much of a serious injury you absorb yourself.

What personal injury protection actually pays

Personal injury protection covers the people in your car after a crash, no matter who caused it. That is the defining feature: it pays first, without waiting to assign blame. A typical PIP policy covers medical bills, a portion of lost wages, and in some states funeral costs and replacement services like childcare while you recover.

Because it pays regardless of fault, PIP is sometimes confused with medical payments coverage, or MedPay, which also pays medical bills regardless of fault. The difference is that PIP is broader, often covering lost wages and services, and it is mandatory in no-fault states, while MedPay is an optional add-on available more widely. Both are different from the liability and uninsured motorist coverages explained in the different types of auto insurance coverage.

PIP is required in roughly a dozen no-fault states and offered as an option in several others. Where it is required, you cannot skip it, but you can usually choose the limit, and that choice is exactly where drivers go wrong. Understanding which coverages sit on your policy and at what limits is the whole point of reviewing what makes up an auto insurance policy before a claim, not after.

Why no-fault states limit your right to sue

A no-fault state runs on a simple bargain. In exchange for getting your medical bills paid quickly by your own insurer without proving fault, you give up some of your right to sue the other driver for pain and suffering. The goal is to keep minor claims out of court and pay injured people faster.

The limit on suing is called a tort threshold, and it comes in two forms. A monetary threshold lets you sue once your medical bills pass a set dollar amount. A verbal threshold, used in states like Florida and New York, lets you sue only if your injury meets a legal definition of serious, such as permanent injury, significant disfigurement, or loss of a bodily function. Below that threshold, your PIP is the end of the road, no matter how large the bill.

This is the part that blindsided Tasha. Her bills were large, but until her injury met Florida’s verbal threshold for a serious injury, she could not reach the at-fault driver’s insurance for the excess. The no-fault system had already decided that her own PIP was meant to handle it, and her PIP stopped at $10,000.

The minimum-limit trap

State-minimum PIP is built to be cheap, not to be enough. Florida’s minimum is $10,000. Some states set their required PIP higher, and a few let you buy substantial limits, but the default most drivers carry is the floor. It looks fine on a quote and feels fine for years, because most fender benders never test it.

A serious crash tests it immediately. Surgery, a hospital stay, imaging, and months of therapy can pass $10,000 in the first week. Once PIP is exhausted, the rest falls to your health insurance, which has its own deductible and copays, or to you directly if your health plan coordinates poorly with auto claims. Lost wages beyond the PIP cap simply go unpaid.

The trap is that the minimum limit is invisible until the day you need more than it provides. It is the same pattern that catches drivers who carry low liability limits or skip uninsured motorist coverage, a gap covered in uninsured motorist coverage explained. The minimum satisfies the law. It does not protect your finances.

How to set a PIP limit that protects you

Start by asking what a serious injury would actually cost you, not what the state requires. If your state lets you raise PIP, moving from a $10,000 minimum to a higher limit usually costs far less per year than the gap it closes, because PIP claims, while occasionally large, are spread across many drivers. The increase in premium is one of the cheaper upgrades on an auto policy, a contrast worth weighing against the factors that drive your auto insurance rates overall.

If your state caps PIP at a low mandatory figure, fill the gap with other coverage. Add or raise MedPay where it is available. Make sure your health insurance coordinates with auto claims. And carry strong uninsured and underinsured motorist coverage, because in a no-fault state that is often how you reach money beyond your own PIP when the other driver is at fault and underinsured.

Tasha’s $42,000 lesson was not that no-fault is unfair. It was that the system handed her control over her own limit, and a $10,000 default made the decision for her. Pull up your declarations page this week, find the PIP line, and raise it before a crash decides the number for you.

Frequently asked questions

What does personal injury protection cover? PIP covers the people in your vehicle after a crash regardless of fault, including medical bills, a portion of lost wages, and in some states funeral costs and replacement services like childcare. It pays first, before fault is assigned, up to the limit you purchased.

Can I sue the other driver if I have PIP in a no-fault state? Only if your injury clears your state’s tort threshold. A monetary threshold lets you sue once medical bills pass a set amount. A verbal threshold lets you sue only if the injury meets a legal definition of serious, such as permanent injury or significant disfigurement. Below the threshold, your PIP is your only source of payment.

What is the difference between PIP and MedPay? Both pay medical bills regardless of fault, but PIP is broader and often covers lost wages and services, and it is mandatory in no-fault states. MedPay is an optional add-on that covers medical and funeral costs only and is available in more states. Some drivers carry both where allowed.

How much PIP coverage should I carry? More than the state minimum if your state allows it. A serious crash can pass a $10,000 minimum in the first week. Raising the limit is usually inexpensive relative to the gap it closes. If your state caps PIP low, add MedPay and strong uninsured motorist coverage to fill the rest.

What happens when my PIP limit runs out? Once PIP is exhausted, remaining medical bills fall to your health insurance, subject to its deductible and copays, or to you directly. Lost wages above the PIP cap go unpaid. In a no-fault state you can only pursue the at-fault driver for the excess if your injury meets the tort threshold.