MedPay is an auto insurance component that covers injuries you or your passengers sustain in a car accident. MedPay is available regardless of the cause of the accident. You are also covered if you are hurt while riding in another car, or if you get hit by a vehicle while walking or riding a bike or using public transport.
You may feel tempted to drop medical payments coverage from your policy if you are looking for ways to lower car insurance premium . It may not be required in your area and is similar to your health insurance.
You would be wrong to dismiss MedPay as ineffective. MedPay is a valuable option to retain, if possible, because of the limitations of most insurance policies and the risk mitigation options offered by this optional coverage.
What is the definition of medical payments coverage?
Medical payments coverage covers medical expenses up to the limit of your coverage for you and any passengers in your vehicle in an accident. This applies regardless of fault. You can use your medical payments coverage to travel with you, whether you are walking, riding with a friend, on public transport, or in-state, as well as with your insured cars, regardless of who is driving. It carries no deductible or co-pay.
While you might believe that your bodily injury liability insurance will cover these expenses, it only covers the medical bills of any other people you injure. This coverage does not protect you. Although bodily injury coverage for another driver can be helpful if you are hurt in an accident caused by another insured driver, it could take several months for the car insurance company to pay your medical bills. While your health insurance may pay, increasing numbers of health insurance policies have high deductibles or co-pays. This can cause financial hardship and make it difficult to get the insurance settlement with another driver.
MedPay provides immediate coverage for medical expenses that you or your passengers may have after an accident. Your medical payments coverage can also protect you in the event that you are injured by a car, whether you’re on foot or as a passenger in a vehicle.
What does MedPay do for auto insurance?
MedPay’s beauty is its ability to quickly pay your medical bills, deductibles and co-pays. You also get coverage for other out-of pocket costs, such as ambulance fees, prothetics, and even funeral expenses.
MedPay policy limits are not the maximum amount of liability coverage. Instead, they refer to the amount that each covered individual is eligible for. If you have a $5,000 MedPaylimit, and you, your spouse, and your children are hurt in an auto accident, you could each collect $5,000 in MedPay coverage, for a total amount of $20,000. Your insurer may not pay the same bills under your MedPay or liability coverage.
You may be eligible to stack your MedPay coverage based on the number of vehicles you have in your policy. If you have three vehicles insured and stack your $5,000 MedPay coverage you will have $15,000 in MedPay available for you and any other individuals involved in an accident.
Drivers without health insurance may find it especially valuable to have medical payments coverage. MedPay should not replace your health insurance. MedPay cannot be purchased unless you have auto liability coverage. You also need to be in an accident that results in injury to your vehicle in order to use it.
What is MedPay?
You may be wondering what coverage you’ll get if you decide to purchase medical payments coverage. These are the coverages MedPay offers:
- MedPay may cover medical care.
- Co-pays and deductibles for health insurance: The great thing about medical payments coverage is the ability to use existing insurance without any out-of-pocket costs. MedPay may cover your co-pays for doctor visits and your health insurance deductible.
- MedPay is not limited to emergency medical care. If you or your passengers are seriously injured in an accident, MedPay can pay for the ambulance ride or emergency medical services.
- Specific diagnostics and treatments: Your medical payments coverage includes services that help determine the extent of your injuries like X-rays or any treatment required to heal.
If you are involved in an accident, medical payments coverage could be a great way to assist you and your passengers.
What is MedPay and PIP different?
This might sound familiar if you are from one of 12 “no fault” states (Florida. Hawaii. Kansas. Kentucky. Massachusetts. Michigan. Minnesota. New Jersey. New York. North Dakota. Pennsylvania. MedPay coverage is similar to personal injuries protection or PIP. In no-fault states, PIP coverage is usually required.
The PIP coverage is similar to MedPay and pays for medical expenses following an auto accident. However, PIP coverage generally covers more than MedPay and can pay for wage reimbursement if you are unable to work due to your injuries.
However, PIP does not cover medical payments. PIP has a deductible while MedPay doesn’t.
What is the cost of medical coverage?
MedPay’s premium is usually very low. However, the benefits that you might receive from one claim could be well worth it.
“For example, suppose your health insurance has a $1,000 maximum deductible and a 20% co-pay, and you have a $5,000 accident medical claim, then you would normally pay $1,800 outof pocket.” Christy Moulton Perry is director of product management at Great Northwest Insurance Co. This is a huge difference.
According to Kip Diggs, almost one in four State Farm drivers declines MedPay despite the strong arguments for it. MedPay is available to those who can afford it or willing to accept the possibility of out-of-pocket expenses in the case of an accident.
Perry believes that a smarter decision for many would have to increase coverage from the basic levels of $1,000 to $5,000 to $10,000 or higher. According to Shawn Wainwright, an agent with Brown & Brown Insurance in Florida, the cost of moving from $2,000 to $10,000 to MedPay on a Travelers car policy is about $10 per year.
Perry states that spending $50,000 to $100,000 can often be very affordable and well worth the investment. I know of a case in which the driver had only $5,000 (MedPay) and was severely injured. Her credit was destroyed a year and a quarter after the accident. She owed all of her hospital bills. She had to wait until the whole claim was closed to get her recovery, even though she was deemed liable by the car insurance company.
She says, “I would not tell anyone that they don’t need it or don’t have the use for it.” You need MedPay.
Questions frequently asked
What is the difference in medical payments and bodily injury?
Your auto insurance’s bodily injury liability only covers medical bills if you are involved in an accident. It will pay for the medical bills of the injured driver and their passengers. However, it does not cover your medical bills or the expenses of your passengers. Depending on the state you live in, you may need to consider MedPay or Personal Injury Protection (PIP) for that coverage.
Are you a candidate for medical coverage with your car insurance?
It all depends on where you live . You will legally be required to have PIP coverage if you live in one of the 12 states that are not at fault. Some states may require MedPay, while others have their own laws. MedPay is not required in all states. MedPay’s low cost makes it a great addition to an existing auto insurance policy.
What MedPay coverage should you have?
It all depends on your needs. You may not require much if you have strong health insurance. However, increasing your MedPay coverage limits often comes at a low cost. It may be worth having more than you actually need. A licensed agent can help you decide the right amount of coverage for your needs.
What if I have medical insurance but don’t have MedPay?
Even if your health insurance does not cover medical payments, it is a smart idea to have coverage. MedPay may be sufficient to cover your co-pays and deductibles for your health insurance so that you can continue using your insurance without any out-of-pocket costs. MedPay also covers your passengers so you can protect everyone riding with you. A licensed agent can help you determine the best MedPay level for your situation.