Kentucky Injury Law News
Beginning tomorrow, significant new benefits become available to many Kentuckians with auto insurance. The number one change is increasing the wage-loss benefit—from $200 to $500 per week—for people who cannot work because of injuries suffered in a motor vehicle collision. But only policies that are newly issued or renewed after July 15, 2026, will include the new benefits. Our advice: Don’t wait for your next renewal! Motorists should contact their insurance agent now and ask whether their existing automobile policies can be replaced or rewritten with new policies issued on or after July 15, 2026.
The reason is important: House Bill 627 (full text here), Kentucky’s new Personal Injury Protection law, applies only to PIP benefits issued or renewed on or after July 15, 2026. Merely being injured after July 15 is not enough to invoke the benefits of the new law. If your current policy was issued before July 15, the old law continues to apply until your next renewal, and you will not be entitled to the increased benefits.
Do not simply cancel your current insurance and risk a gap in coverage. Ask your agent to replace or rewrite the policy, confirm the effective date in writing, and make sure the replacement policy is fully bound before the old policy ends. Also verify that the new policy does not reduce your liability, uninsured-motorist, underinsured-motorist, collision, or comprehensive coverage. We have seen a trend of clients cancelling their UIM (underinsured motorist) coverage to save only a few dollars on their premiums. That is almost always a mistake because, in nearly every serious-injury collision, the at-fault driver is underinsured.
What Is PIP?
Personal Injury Protection is usually called PIP or “no-fault” coverage. When you are in a wreck, your own insurance (or the insurance of the vehicle where you were riding) pays certain benefits for injuries caused by the wreck, no matter who was at fault.
Most Kentucky automobile policies are required to provide $10,000 in “basic reparation” PIP benefits per injured person. It is invaluable coverage that can pay covered benefits almost immediately, without waiting for a determination of who is at fault. Those benefits can pay medical expenses, lost income, replacement services, and certain losses resulting from death. Motorists can also buy additional “added reparation benefits” to extend that no-fault coverage, usually in increments of $10,000 of coverage. It is cheap insurance, usually costing just a few dollars extra for each $10,000 increment, and we highly recommend that every driver purchases added reparation benefits as well.
House Bill 627 makes several meaningful changes to those benefits.
The Major Changes Under House Bill 627
- The weekly limit for lost wages or survivor’s economic loss increases from $200 to $500. This pays a wage loss benefit to the injured person or, if she has died as a result of the wreck, to her dependents.
- The weekly limit for ‘replacement services’ increases from $200 to $500.
Replacement services benefits reimburse the injured party when he has to pay someone else for providing services he ordinarily would have performed before the injury. Examples may include lawn maintenance, house cleaning, child care, or transportation costs like hiring an Uber. - The limit for funeral, cremation, and burial expenses increases from $1,000 to $5,000.
- Medical payments will now be based on Kentucky’s workers’ compensation medical fee schedule.
In the past, PIP benefits were often used up quickly because they paid a doctor or hospital’s full charge, when private insurance or government programs like Medicaid or Medicare would have negotiated a much lower cost. Now, the providers are limited to claiming what they would be reimbursed when being paid by workers’ compensation programs. This should allow patients to stretch their PIP benefits further, but the downside is, it may make some providers more skeptical about treating motor vehicle injury patients, so it is good to call ahead if you will be using PIP to pay your expenses. Once she has accepted payment under the PIP statute, your doctor can never bill you for any portion of her bill PIP doesn’t cover (unless it was not covered because you have used up your PIP).
Medical providers now must submit their charges within 180 days.
It is important to make sure your provider has submitted the bill during this shortened timeframe, or you may be left with a bill for benefits that PIP should have paid.
The $10,000 total PIP limit does not increase
Although House Bill 627 improves several individual benefits, it does not increase Kentucky’s overall $10,000 PIP limit for basic reparation benefits. No matter what benefits would be covered, you are not entitled to more than $10,000. This is why we recommend above that every motorist purchase additional PIP – added reparation benefits on top of the basic reparation benefits required by law. An added benefit is that purchasing added reparation benefits allows you to “stack” benefits. So if you purchase $30,000 of total coverage – three times the required minimum – you also are entitled to up to three times the weekly benefit. In this case, that would be $1,500 per week of wage loss coverage. This is important, since even with this new increase, the basic benefit is only about one-half of the average weekly wage of Kentuckians.
The increase in wage-loss benefits is significant
The increase from $200 to $500 per week is one of the most important changes in the law. Here is how it works. A covered beneficiary who is unable to work because of a motor vehicle injury is entitled to receive 85% of his or her average weekly wage, either until they are able to return to work or their PIP limits are used up. That means that any worker earning more than $588 per week would receive the maximum benefit of $500, assuming they are unable to work at all. Why the 85% cap? Because PIP benefits are tax free, the legislature is assuming the victim would have paid 15% in income taxes, and therefore the benefit of the coverage is the same.
Here is an example: Suppose an employee earns $800 per week and cannot work for four weeks because of injuries from a car wreck. Under the old cap, the maximum PIP would pay for those four weeks would be $800 in total. Under the new law, the policy would likely pay $2,000.
The old $200 weekly limit was plainly inadequate. Increasing it to $500 is overdue, but even the new amount will not fully replace the wages of most injured Kentuckians, which is why it is a good idea to buy extra coverage.
The new benefits do not apply just because the injury occurred after July 15.
This is the part of the new law that motorists most need to understand immediately.
Sections 1 through 3 of House Bill 627 apply only to basic and added reparation benefits issued or renewed on or after July 15, 2026. Because most policies are written to last either six months or one year, you may not be eligible for the new benefits for some time.
Consider a driver whose six-month policy renewed on July 10, 2026. If that driver is injured in a collision on July 20, the policy would remain governed by the old rules because it was renewed before July 15, and the occupants would still be subject to the old $200 weekly wage loss cap, and medical bills would still be paid at the doctor’s regular rate, running the coverage out quickly. Unless the insurer replaces or rewrites the policy, the driver will not receive the increased benefits until the next renewal.
The prudent course is therefore:
- Contact your agent immediately.
- Ask whether your present policy can be replaced or rewritten effective on or after July 15.
- Obtain written confirmation that the new policy is subject to House Bill 627.
Confirm that all existing coverage limits remain intact. - Never allow the old policy to terminate before the replacement coverage is effective.
House Bill 627 is a real improvement for Kentucky residents injured in motor-vehicle collisions. But those improved benefits will not necessarily apply simply because a wreck happens after the law takes effect. Now is the time to review your automobile insurance coverage—not after you’ve been injured in a collision.
This article provides general information and is not legal advice. Anyone injured in a motor-vehicle collision should consult an attorney about the insurance policies and laws applicable to the particular claim.