Coverages Required By Law

A basic policy is a low-cost policy that provides minimum benefits. Under a basic policy, the following coverages and limits are required by law.

Personal Injury Protection or PIP is often called "no-fault" coverage because it pays for injuries to a policyholder and their passengers, no matter who is at fault in an accident.

A basic policy offers $15,000 in personal injury protection coverage and includes up to $250,000 of medical benefits for catastrophic-type injuries.

Insurers will pay PIP benefits over the deductible amount chosen. PIP deductibles range from the minimum deductible of $250 and up to $2,5000. After the deductible is paid, there is a 20% co-payment on medical expenses up to $5,000 after which the insurer pays 100%.

Property damage liability coverage pays to repair damage to other people's property caused by a covered automobile. This type of coverage also pays legal defense and settlement costs up to the limits of coverage. Under a basic policy, $5,000 of property damage liability coverage is mandated and higher limits CANNOT be purchased.

See Also:
Options Under a Basic Policy