Alyssa Lane
Medical payments coverage, also known as MedPay, is an additional coverage option for auto insurance policies in most states. It covers injuries suffered by the insured driver or their passengers in a car accident, regardless of who is at fault. MedPay is not required in most states, but it is a good idea to have it to cover out-of-pocket medical expenses. Personal injury protection (PIP) is another type of insurance that covers medical expenses for you and your passengers in an accident, and it is required in some states.
| Characteristics | Values |
|---|---|
| What does auto medical insurance cover? | Covers medical expenses for the insured in the event of an accident |
| Does it cover passengers? | Yes, it covers passengers' medical expenses in the event of an accident |
| Is it mandatory? | No, it is not mandatory in most states |
| What are the other types of insurance that cover medical expenses? | Bodily injury liability coverage, Personal Injury Protection (PIP) coverage, and Health Insurance |
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What You'll Learn
Medical payments coverage
MedPay is not required in most states, but it is a good idea to consider adding it to your auto insurance policy, especially if you are not sure you could afford to pay for medical bills after a car accident. The cost of MedPay coverage varies but is generally inexpensive, with many policyholders adding coverage for $5 to $8 per month. MedPay limits typically range from $1,000 to $10,000, depending on the state and insurer. When choosing your coverage limit, it is important to consider the other health insurance plans you have. If you select a MedPay coverage limit higher than your health insurance deductible, it can help cover your deductible and any remaining medical costs.
It is important to note that MedPay is not offered in every state. States that do not offer MedPay typically have Personal Injury Protection (PIP) coverage, also known as no-fault insurance, available instead. PIP coverage is required in some states and provides immediate and necessary medical treatment for you, your family, and your passengers, regardless of who caused the accident.
To add MedPay to your auto insurance policy, you can work with a medical payments adjuster to ensure that all necessary medical records and bills are forwarded. The adjuster will review the paperwork and either fully or partially reimburse the appropriate party, request additional information, or deny the claim.
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Personal injury protection
PIP insurance covers medical expenses, including hospital bills, doctor fees, treatment costs, and medications. It can also provide reimbursement for the costs of physical or occupational therapy if needed. The amount covered varies by state, with some states mandating PIP insurance and others not offering it at all. For example, in Washington state, PIP covers up to $10,000 for reasonable and necessary medical and hospital expenses for each person injured in an auto accident, with additional coverage available to increase this benefit to $35,000.
In terms of lost wages, PIP insurance can provide income replacement coverage, typically up to $200 per week with a total limit of $10,000. This income replacement coverage is usually limited to one year after someone has been disabled for a certain period, such as 14 consecutive days after the accident. Again, additional coverage may be available to increase the total benefit amount.
It's important to note that PIP insurance does not cover everything, and there are certain exclusions. For example, it does not provide protection for damage to your car itself, and only covers costs related to physical injuries to you and your passengers. To protect your vehicle, you would need to consider additional coverage options, such as Comprehensive Coverage or Collision Coverage.
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$4.25
Bodily injury liability coverage
The amount of bodily injury liability coverage you need will depend on the state in which you reside. In most states, you are required to have a minimum amount of bodily injury liability coverage to drive legally. Some experts recommend having bodily injury limits of at least $100,000/$300,000, while others suggest choosing a coverage limit equal to or greater than your net worth. This is because if you don't have enough liability coverage to pay for an at-fault accident, you may be sued, and your savings, house, and other assets could be at risk.
To determine how much bodily injury liability coverage you need, you can consider your net worth, which is calculated by subtracting what you owe from what you own. If your net worth is greater than $500,000, which is the maximum amount of liability coverage offered by many auto insurers, you may need to purchase an umbrella insurance policy to provide additional liability protection. This type of policy can increase your liability coverage limit to up to $5 million.
It's important to review your insurance policy to understand your specific coverage limits and exclusions. The liability limits on your policy will typically be displayed as three numbers, such as "100/300/100." The first number represents the per-person bodily injury liability coverage, the second number represents the per-accident bodily injury liability coverage, and the third number represents the per-accident property damage liability coverage.
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Health insurance deductible
A health insurance deductible is a specified amount or capped limit that an individual or family must pay before their insurance coverage kicks in and starts sharing the costs. This is an annual amount that resets at the start of each calendar year. The deductible amount varies from plan to plan and can be high or low, with higher deductibles typically having lower monthly premiums and vice versa.
For example, if you have a $1000 deductible, you must pay $1000 out-of-pocket before your insurance covers any expenses. This can be from a single visit or accumulate over multiple visits. You pay the deductible amount directly to the medical professional, clinic, or hospital. Once you've met your deductible, you may still be responsible for a copayment or coinsurance, with the insurance company paying the remaining charges.
Copayments are fixed fees for specific services, like office visits or prescription pickups, and are usually modest amounts. Coinsurance, on the other hand, is the percentage of the costs you continue to pay after meeting your deductible. For instance, if your coinsurance is 20%, you pay 20% of the costs, and your insurance covers the remaining 80%.
It's important to note that deductibles do not include coinsurance, charges in excess of the allowed amount, amounts exceeding any maximum, or charges for non-covered services. Additionally, your deductible will generally be higher if you use a medical provider outside your plan's network.
High-deductible health plans (HDHPs) are a specific type of plan that follows IRS rules. For 2025, the IRS defines an HDHP as having a minimum deductible of $1,650 for individual coverage or $3,300 for family coverage. These plans typically have lower monthly premiums but higher out-of-pocket costs.
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Medical expenses
In contrast, bodily injury liability insurance only covers medical expenses for others if you are the at-fault driver. It does not cover the driver's own medical bills or those of their passengers who are family members. Therefore, it is advisable to have medical payments coverage, especially if your health insurance has high deductibles or does not cover all accident-related expenses.
The amount of medical payments coverage you need depends on the amount your health insurer will pay for accident-related expenses. The more coverage you buy, the higher the MedPay premium. It is important to review your policy to understand the covered and excluded situations, as they may differ by state.
In addition to medical expenses, personal injury protection (PIP) or no-fault insurance can also cover lost wages resulting from an accident. This is beneficial if you need to take time off work to recover from your injuries. Overall, having medical payments coverage provides financial security and peace of mind, ensuring that you and your passengers are protected in the event of an accident.
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Frequently asked questions
Yes, auto medical insurance covers passengers in the event of a car accident. This is known as medical payments coverage or MedPay. It covers medical and funeral expenses for passengers, regardless of who is at fault.
Medical payments coverage is an additional coverage option for auto insurance policies in most states. It helps pay for medical and funeral expenses resulting from a car accident, regardless of who is at fault. It can also help cover out-of-pocket costs, such as deductibles and copays.
MedPay can help cover out-of-pocket costs that health insurance may not cover, such as deductibles and copays. It is especially useful if you have a high health insurance deductible or expensive copays.
No, MedPay is not offered in every state, but it is available in most. States that don't offer MedPay typically have Personal Injury Protection (PIP) coverage available instead.
