Should my Car Accident Lawyer Take a Fee from my PIP?

I have many people ask whether my car accident lawyer is permitted to take a fee from my Personal Injury Protection (PIP).  When you sign a contract to hire a lawyer for your auto accident case, the contract probably provides that the attorney’s percentage comes from “any and all” amounts that are collected.  Technically, this would include PIP benefits.  Whether a lawyer “should” take a fee from the PIP, however, is another question.  Rest assured that many auto accident lawyers in the Dallas / Fort Worth area will take a fee from the PIP as a matter of general practice.  There are auto accident lawyers who do consider waiving the fee from PIP as a courtesy, but that decision is usually made at the settlement stage of the case.  It would be wise to discuss this matter with your lawyer and get an idea of how the lawyer generally handles this issue.

Personal Injury Protection (PIP) is insurance coverage that you can purchase through your auto insurance policy.  In Texas, all auto insurance policies must provide for PIP unless the coverage is rejected in writing.  The minimum amount of coverage in Texas is $2,500, although you can purchase more coverage if you wish.  If you are involved in an auto accident, PIP will cover your medical bills as well as 80% of your lost wages, regardless of any fault on you.  There are, however, scenarios in which PIP is handled differently on your auto accident claim, and could effect how your lawyer decides to handle the PIP.

Let’s say that you are involved in an auto accident that was not your fault.  Your auto accident lawyer will not only make a claim against the other driver’s insurance company, but will also make a claim on your insurance policy for the PIP benefits.  This is because, more often than not, the amount of the settlement offered by the other driver’s insurance will most likely not be enough to pay your lawyer, your doctors, and also net some money in your pocket.  The PIP helps your auto accident lawyer settle the case by having more funds available to satisfy all the parties involved.  This is because the other driver’s insurance does not get any credit for the PIP.  For example, if your case is worth $10,000, then you would be able to collect $10,000 from the other driver’s insurance and still be able to collect the $2,500 in PIP benefits, for a total of $12,500.  Whether your auto accident lawyer should take a fee from the PIP portion depends on many circumstances as well as the general practices of your lawyer.

Now, let’s assume that the other driver did not have insurance.  If you had uninsured motorist coverage (UM/UIM), then your insurance company will pay the claim based upon what the uninsured driver would have been liable to pay under the law.  In this sense, your insurance company will step into the shoes of the insurance that the other driver should have had.  Your auto accident lawyer will, therefore, submit your case to your insurance company for PIP and UM benefits.  However, now your insurance company gets a credit for the PIP benefits.  For example, let’s assume again that your case is worth $10,000, and you have $2,500 in PIP benefits.  In this case, your PIP will pay $2,500 and your UM will pay $7,500 (“new money”), for a total of $10,000.  Therefore, your auto accident lawyer can justify taking a fee from the PIP because the PIP is actually part of the entire value of the case.

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If you are interested in this article, then chances are that you researching your options for hiring a car accident attorney.  If you are, however, using this site as a tool to handle your own case, then please do not make the mistake of thinking that articles like this are a substitute for hiring an experienced lawyer.  Here are some articles about the importance of getting an experienced personal injury lawyer to represent you in your case:

What is Personal Injury Protection (PIP)

Should I Hire a Car Accident Attorney?

Top 5 Do’s and Don’ts of a Personal Injury Claim.

Don’t Represent Yourself.

Call Now and personally speak with Robert C. Slim, Attorney at Law, about your car accident case.  You will get to consult with the lawyer for free  with no obligations.  And if you decide to hire Attorney Slim, his fees are collected only if and when there is a recovery in your case.

14 thoughts on “Should my Car Accident Lawyer Take a Fee from my PIP?”

  1. Is 40% fee a standard on all Underinsured automobile accidents? My case fee against the uim was 33%. And now since I’ve won payment from my insurance the fee went to 40%.

    1. Every attorney may have a different fee structure, But generally, the fee percentage goes up only if a lawsuit is filed. For instance, I charge 33 1/3% for settlement prior to any lawsuit being filed and 40% if a lawsuit is filed. It make no difference to me if it is a liability settlement, UM settle, etc. However, your attorney may have a different fee structure. Just refer to the fee contract you signed with your attorney.

  2. Can a PIP be filed under my insurance and the the other drivers insurance who caused the accident?

    1. Yes. You can file for PIP based upon your medical expenses. And, you can still submit those same medial expenses for recovery under the injury claim against the at-fault driver. The negligent party and their insurance company do not get credit for the PIP benefits you collect.

  3. My doctor wants to split my pip coverage. My pip is $5000 and he wants half of it becaus we are not going through an attorney. Is that even legal?

  4. It’s good to know that an auto accident lawyer can make a claim against the other driver’s insurance company but your own as well. My sister was in an accident recently, but she is confused about the legal situation surrounding the accident. I’ll pass this information along to her to help her understand what is happening.

  5. You said whether our lawyer takes a fee from the PIP portion depends on a lot of circumstances. This is great to know, especially since my husband just got in a minor car crash. I’ll let him know this so that he can look for a car accident attorney to help him with his case.

  6. It’s really interesting how you said that if the case is worth $10,000 you can collect that much more and a little extra from PPIs and things like that. I imagine that it would be really wise to have a lawyer with you to ensure that you can get all that you can from your case. That way you will always have the money you need to take care of your injuries or buy a new car without any troubles.

  7. I did not know the fact that personal injury protection will cover your medical bills as well as 80% of your lost wages, regardless of any fault on you. My cousin had an accident but he has not received any compensation yet. I will suggest to him to contact a car accident attorney to help him with this legal process.

  8. I find it interesting that you said that an accident lawyer takes funds from your insurance to pay all the bills. Someone told me that collision attorneys can help you get more compensation for your injuries. Thank you for helping me learn what a PIP is used for, during an accident case.

  9. I was rear-ended and my attorney claimed pip from my insurance and kept it stating he gets partial payment and the remaining for medical bills. While in the settlement sent to the at fault driver they are requesting she pay medical bills which still totaled less than what they kept from pip so do I receive my pip if the at fault driver pays my medical bills or does the attorney keep my pip.

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