How are my lost wages calculated under PIP coverage?

In Massachusetts, every owner of a registered motor vehicle is required to carry a minimum amount of insurance coverage. Part of this “compulsory package” is Personal Injury Protection coverage; otherwise known as PIP.  One of the benefits of PIP is that the insurer will pay up to 75% of your lost wages when you’ve been hurt in a car accident and you are unable to work because of your injuries.

This lost wage benefit is usually calculated by the insurer based on your average weekly wage for the last 52 weeks of work. So if you usually work 40 hours a week at $15/hour and you’ve done so consistently for the last 52 weeks, then you would expect your insurance company to pay you lost wages of $450/week while you are unable to work (that’s 40 x $15 = $600 x .75 = $450).

To process your lost wage claim, though, your insurer will need 1) proof that you are disabled and unable to work because of your accident-related injuries (this usually comes from your treating physician in the form of a medical note stating that you are unable to work because of your injuries); and 2) proof of your wages from your employer (the insurance companies usually have a form that they will send to your employer to confirm your employment and wages, so be sure to warn them that it may be coming and why – telling your employer helps alert them that you are trying to collect wages from your insurance company).

Now, you don’t always need a lawyer to handle your PIP claim; in most instances you can handle your lost wage claim yourself with your insurance company.  Your keys to success, though, will be maintaining communication with your insurance adjuster AND providing good documentation- that shows you’re unable to work and the amount of your earnings.

To learn more about PIP benefits in Massachusetts, request a copy of our book, Massachusetts Auto Accidents: The 5 Biggest Mistakes Massachusetts Consumers Make When Buying Auto Insurance.  If you have any questions about your PIP claim or whether your insurance company is calculating your lost wage benefits properly be sure to consult with an experienced personal injury lawyer.


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