Summary: The Kentucky Motor Vehicle Reparations Act requires every owner of a registered motor vehicle in the state to buy and maintain personal injury protection. The law exempts government owned vehicles, farm tractors, road graders and other construction equipment not used to transport people or property, and mopeds. The coverage is provided by endorsement PP 05 70 03 11, Personal Injury Protection Coverage—Kentucky.

Topics covered:
Who is insured
Exclusions
Benefits
Definitions
Tort liability

Who Is Insured

As is the case with other no-fault states, Kentucky has abolished tort liability in connection with the ownership or use of a motor vehicle if the owner of that vehicle has purchased personal injury protection coverage. However, Kentucky residents may reject the limitations on their right to sue for damages in connection with an auto accident. The rejection must be in writing and filed with the state department of insurance. The decision to reject no-fault benefits is an individual decision. Members of a single household may differ as to whether they want to be subject to the limitations of the law, or retain their rights in tort. If a person chooses to reject no-fault, the form makes it clear that he or she may not collect no-fault benefits. It should be noted that a person may reject no-fault for a motorcycle but keep no-fault for any automobiles.

PP 05 70, in accordance with the Kentucky Motor Vehicle Reparations Act, offers personal injury protection benefits to or for an insured who sustains bodily injury; the injury must be caused by an accident arising out of the operation, maintenance, or use of a motor vehicle as a vehicle. The term “insured” includes the named insured or any family member (the spouse and any person related to the named insured by blood, marriage, or adoption, and minors in the custody of the named insured, all of whom are residents of the named insured's household) while occupying or as a pedestrian when struck by any motor vehicle. The term also includes any other person while occupying or as a pedestrian when struck by the named insured's covered auto.

The endorsement specifically states who is not considered an “insured.” The term does not include the named insured or any family member who has rejected the limitation upon his tort rights, or any other person who has rejected the limitation. As noted previously, any rejection of tort limitations applicable only to motorcycles shall not affect the status of any person as an insured with respect to any motor vehicle other than a motorcycle.

Exclusions

The endorsement does not provide personal injury protection coverage for bodily injury sustained by any person while engaged in the automobile business; such activities include repairing, servicing, and maintaining a motor vehicle. However, if the injury occurs off the business premises, coverage does apply. Another exclusion eliminates coverage for injuries sustained while loading or unloading a motor vehicle, but the exclusion does not apply if such conduct occurs while the insured is occupying that motor vehicle.

Another exclusion eliminates coverage for injuries sustained as a pedestrian while outside of Kentucky for other than the named insured or family members. The “livery use” exclusion is worded differently than most. The Kentucky form excludes injuries to any insured, other than the named insured or any family member, sustained while occupying a motor vehicle that is regularly used in the course of the business of transporting persons or property, and is part of a fleet of five or more vehicles under common ownership. This exclusion does not apply if the insured is a Kentucky resident, if the motor vehicle the insured is occupying at the time of the accident is a bus (registered in Kentucky and secured as required by state law), and if the insured boarded the bus in Kentucky.

There is also no coverage for injuries sustained by any insured other than the named insured or any family member while occupying a car owned by any unit of government other than the state of Kentucky if the accident occurs outside of Kentucky.

There is no coverage for any insured intentionally causing or attempting to cause bodily injury. There is no coverage for any insured, other than the named insured or any family member, who sustains injury arising from the maintenance or use of a motor vehicle without a good faith belief that he or she is legally entitled to do so.

Coverage is also excluded for injuries due to war, the nuclear peril, the use of a vehicle as a residence, and while occupying a motorcycle. The occupying a motorcycle exclusion may be eliminated with payment of an additional premium and by indicating this choice on the endorsement's schedule.

The endorsement does not provide coverage for the named insured or any family member who has not rejected the tort limitation pursuant to the Kentucky Motor Vehicle Reparations Act, while occupying or as a pedestrian when struck by any motor vehicle other than the named insured's covered auto. This exclusion does not apply if the provider of the security required by the law fails to make payment for loss within thirty days of reasonable proof of the fact and the amount of loss sustained.

Benefits

The basic form provides a maximum limit of liability of $10,000 of coverage in the aggregate for the following six categories:

Medical Expenses: Reasonable charges incurred for reasonably needed (no definition listed on the endorsement) products, services, and accommodations. Also covered are physical rehabilitation, job retraining, and remedial treatment and care. If licensed by the state, the policy will also pay practitioners of any recognized religious method of healing or any healing arts profession. Hospital, clinic, convalescent, and nursing home expenses are covered up to the reasonable and customary charge for a semiprivate room.

Work Loss: Loss of income from work that an insured would probably have performed had he not sustained injury, reduced by any income from substitute work actually performed, is covered.

Survivor's Economic Loss: Covers loss of contributions of things of economic value (such as wages) to the survivors after the death of an insured.

Replacement Services Loss: Applies to expenses reasonably incurred in obtaining ordinary and necessary services that the insured would have performed for the benefit of himself or his family, such as the contributions of a homemaker.

Survivor's Replacement Services Loss: Similar to the replacement services loss category but pays for obtaining ordinary and necessary replacement services in place of those an insured would have performed had he not died.

Funeral Expenses: Reasonable charges incurred for expenses that are in any way related to a funeral, cremation, or burial are covered and payable up to $1,000.

The payments available for work loss, survivor's economic loss, replacement services loss, and survivor's replacement services loss are limited to $200 per week in the aggregate, prorated for any lesser period. All benefits payable under PP 05 70 are reduced by the amount of any workers compensation payments that the insured receives. However, if the workers compensation benefits are not paid until after the payment of personal injury benefits, the insured is not required to refund any payments to the insurance company. The personal injury benefits are also subject to a 15 percent reduction to recognize the tax savings resulting from the payment of nontaxable sums.

Definitions

PP 05 70 has some definitions that should be noted. The term “insured” has been discussed previously, as has “family member.” “Covered auto” means a motor vehicle to which the bodily injury liability coverage of the policy applies and for which the named insured is required by the law to maintain security. “Motor vehicle” means a vehicle as defined in the Kentucky Motor Vehicle Reparations Act. “Pedestrian” means a person who is not occupying a motor vehicle at the time injury occurs. “Survivor” means a person identified in the Kentucky Revised Statutes as one entitled to receive benefits due to the death of another person.

Tort Liability

Tort liability in connection with bodily injury arising out of the ownership, maintenance, or use of a motor vehicle is abolished by the Kentucky Motor Vehicle Reparations Act to the extent that no-fault benefits are payable for such injuries. Tort recovery for noneconomic loss (such as pain and suffering or inconvenience) is allowed when incurred medical expenses exceed $1,000 or when the injury results in permanent disfigurement, injury, or loss of a bodily function; fracture of a weight-bearing bone, or a compound, comminuted, displaced, or compressed fracture; loss of a body member; or death.

As has already been pointed out, Kentucky law affords those subject to the state's no-fault requirements the option of rejecting these limitations on their rights to recovery in tort; the exercise of this option makes one ineligible to receive personal injury protection benefits. Endorsement PP 05 70 contains the provisions of the Kentucky statute relating to the limitations on tort liability and carries the law's stipulation that acceptance of the coverage provided entails acceptance of the limitations.