Auto Insurance And Passenger Medical Coverage: What You Need To Know

Medical payments coverage, also known as MedPay, is an optional type of car insurance that covers medical expenses for injuries sustained by the insured driver and their passengers in a car accident, regardless of who is at fault. It also covers the insured if they are injured as a pedestrian by a vehicle. MedPay is not available in all states, and the amount of coverage varies, so it is important to check with an insurance representative to understand what your policy covers. MedPay can provide valuable protection in the event of an accident, helping to cover medical bills and providing additional peace of mind for drivers and their passengers.

Medical payments coverage (MedPay)

Medical payments coverage, also known as MedPay, is an optional coverage that gives you extra funds towards medical bills for you and your passengers in an accident. MedPay is not available in all states, so it is important to check with your insurance representative to see if it is available to you.

MedPay can be used to pay for a number of things, including health insurance costs, such as deductibles and copays, doctor or hospital visits, surgery, X-rays, prosthetic limbs/parts, and emergency room costs. It can also be used to pay for extended nursing services or hospitalization. Importantly, MedPay does not cover lost wages if you are forced to miss work due to a car accident.

MedPay is typically purchased in specific dollar amounts, and the amount of coverage you pick is the maximum amount available to each person covered. For example, if you have $1,000 in medical payments coverage and you and two passengers are injured in an accident and need to go to the emergency room, you and each of your passengers may have up to $1,000 to help pay for medical bills related to the accident.

MedPay is different from personal injury protection (PIP) and bodily injury liability coverage. PIP is available in "no-fault" states, while MedPay is offered in states without "no-fault" laws. PIP may also cover additional expenses that MedPay does not include, such as lost wages or childcare for essential services. Bodily injury liability coverage, on the other hand, only applies to the other driver and their passengers, not to you or your passengers.

Personal injury protection (PIP)

PIP is available primarily in no-fault states, where if a policyholder is injured in a car crash, their policy pays for their medical care regardless of who caused the accident. Policyholders with PIP coverage can receive benefits even if the other driver doesn’t have insurance. PIP pays for medical expenses for people in the policyholder's vehicle, no matter who causes the accident.

In addition to making medical care affordable, PIP often provides payments for lost income, child care, and funeral expenses related to the accident. Some no-fault states offer medical payments coverage, but it typically has low limits and does not pay for these other costs.

PIP auto insurance is required in 15 states and Puerto Rico. Minimum coverage requirements are set by the state governments and can vary. Maximums are set by insurance companies and can also vary, but they are usually no more than $25,000. For example, in Florida, where a minimum personal injury protection policy of $10,000 is required, if you caused an accident that resulted in injuries to you that required medical treatment costing $15,000, your PIP would cover $10,000. If you purchased a plan with more coverage, your insurance would pay for expenses up to that limit.

The purpose of no-fault insurance is to restore individuals hurt in auto accidents to health and productivity as swiftly as possible. In New York, for example, because of the No-Fault law, lawsuits due to auto accidents can only be brought for economic losses that exceed No-Fault benefits and for non-economic damages (such as pain and suffering) if a "serious injury" (as defined in the Insurance Law) is sustained.

Bodily injury liability coverage

BI coverage can help pay for a range of expenses, including emergency care services, ongoing care costs, and legal fees if you are sued for damages. It can also provide financial assistance to injured parties who have to miss work or are unable to work due to their injuries. In some cases, BI coverage may also include payment for emotional stress or prolonged pain resulting from the accident.

One important aspect of BI coverage is its limits, which are typically represented as a "number/number" format, such as 100/300. The first number indicates the maximum amount your insurance company will pay per person, while the second number represents the total per accident. For example, with a 100/300 limit, your insurance would pay up to $100,000 per person and a maximum of $300,000 total if four people are injured in the accident.

It is worth noting that BI coverage only comes into effect when you are at fault for the accident. If you or your passengers are injured in an accident that is not your fault, medical payments coverage (MedPay) or Personal Injury Protection (PIP) may provide coverage for your medical expenses, regardless of who is at fault. However, BI coverage is crucial for protecting yourself financially in the event that you are found liable for causing an accident and need to compensate injured parties.

When purchasing auto insurance, it is important to carefully review the details of your policy, including the limits and exclusions of your BI coverage. Understanding your coverage can provide peace of mind and ensure that you have adequate protection in the event of an accident. Consulting with an insurance agent or representative can help you make informed decisions about your policy and ensure you have the right coverage for your needs.

Medical payments coverage limits

Medical payments coverage, also known as MedPay, is an optional form of auto insurance that covers medical and funeral expenses after a car accident. It applies regardless of who is at fault and covers the policyholder, family members driving the car, and any passengers. MedPay coverage limits are usually low and intended to cover immediate expenses or supplement other types of insurance. Coverage limits on MedPay typically range from $1,000 to $25,000, with some companies offering coverage up to $50,000 or $100,000.

The cost of MedPay depends on the chosen coverage limit, with higher limits resulting in higher premiums. The most common coverage limits offered by insurance companies are $1,000, $2,000, $5,000, $10,000, and $25,000. The cost of adding MedPay to a policy can range from $2 to $37 per month, depending on the desired coverage amount.

When choosing a MedPay coverage limit, it is important to consider the potential costs of medical and funeral expenses that may be incurred in the event of a car accident. It is also worth noting that MedPay may not cover all types of expenses, such as injuries sustained while in a trailer or other equipment attached to the car. Additionally, MedPay does not cover damage to vehicles or other property.

MedPay can be a valuable addition to an auto insurance policy, especially for individuals who do not have comprehensive health insurance or personal injury protection. It provides peace of mind and financial protection in the event of a car accident, ensuring that medical and funeral expenses will be covered regardless of who is at fault.

Medical payments coverage vs health insurance

Medical payments coverage, or MedPay, is an optional form of auto insurance that covers the medical and funeral expenses of the policyholder, their family members, and passengers after a car accident, regardless of who is at fault. MedPay also covers medical expenses if the policyholder or their family members are injured by a vehicle while walking, cycling, or riding public transit. MedPay typically costs less than $10 per month and does not require the policyholder to pay any deductibles or copays.

On the other hand, health insurance typically covers medical expenses but may exclude injuries related to a car accident, leaving the policyholder with high out-of-pocket expenses. Even if a health insurance plan covers car accidents, there may be deductibles or copays that the policyholder must pay before the insurance company covers the rest.

MedPay can be useful for filling in the gaps of a health insurance plan. It can help cover the deductibles or copays of a health insurance policy, and it can provide coverage for passengers who are not on the policyholder's health insurance plan. MedPay is also useful for those who frequently drive passengers who are not family members, as it typically applies to anyone in the car at the time of the accident.

However, MedPay has its limitations. It does not cover costs above the policy's limit, wage reimbursement for missed work, childcare costs, or treatment for injuries to other drivers in a crash. Additionally, MedPay is not available in states where personal injury protection (PIP) is required, as PIP offers more extensive benefits, such as wage reimbursement and coverage for non-medical expenses like childcare.

Frequently asked questions