In the U.S., around 3 million people are injured in non-fatal car accidents each year. These injuries account for more than $75 billion in medical costs and loss of productivity at work annually.
Fortunately, there are many different types of car insurance designed to cover the costs associated with injuries suffered in a car accident. Which type of insurance depends primarily on the state where the accident took place.
Generally speaking, it boils down to either bodily injury liability (BIL), personal injury protection (PIP), or medical payments coverage (also known as MedPay). If you’re found to be responsible for a car accident, bodily injury liability pays for the costs associated with the injuries you’ve caused to others. When someone else is at fault, their liability insurance will pay for your medical expenses.
But what if you’re injured in an accident that you caused? For this, you have either PIP or MedPay, or a combination of the two. For more on MedPay, how it works, and how you can find cheap car insurance quotes online, here’s what you should know.
What is medical payments coverage?
Medical payments coverage, more commonly known as MedPay, covers the medical costs for you and your passengers if you’re injured in a car accident. Even if you’re the at-fault driver, MedPay will pay out.
In addition to medical costs, MedPay will also pay funeral expenses if someone dies in an accident. And if you have MedPay coverage, it should also pay your medical bills if you or a family member are hit by a vehicle while walking or are injured while riding in another person’s vehicle. MedPay fills in any coverage gaps in your normal health insurance and can even cover your deductible and copays.
What else does medical payments insurance cover?
MedPay does more than just cover your medical bills and funeral expenses. It may also reimburse you for ambulance fees, dental care, chiropractic care, X-rays, prosthetics, professional nursing services, funeral expenses, deductibles, and co-pays. MedPay can function as co-insurance for other types of insurance as well, such as health insurance and personal injury protection.
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What does medical payments insurance not cover?
While MedPay covers most medical bills associated with a car accident, there are some things that MedPay won’t cover. These include:
- Wage reimbursement (if forced to miss work due to injuries)
- Child care costs (if limited physically due to injuries)
- Medical bills for injuries suffered by other drivers
- Treatment of injuries or health problems unrelated to a car accident
In addition, there are some exclusions to MedPay coverage, including injuries that occur:
- While driving a vehicle with less than four wheels
- While using your vehicle as a public conveyance (Uber, Lyft, and other ridesharing companies)
- While you’re parked at your residence or other building and not driving
- While driving a vehicle that you don’t own or use regularly
If you’re injured at work and your injury falls under worker’s compensation, MedPay will not cover it. Nor will it pay out for injuries sustained from an act of war or suffered while participating in an organized race.
MedPay also does not compensate you for any pain, suffering, or emotional distress you suffer due to an accident. For that, you’ll have to sue the other party in a court of law.
Medical payments coverage limits
Like most types of car insurance, there are financial limits to the amount of coverage you have under MedPay. Maximums are usually around $10,000 or less, depending on the state where you have car insurance. MedPay generally works in conjunction with your health insurance or PIP, if you have either one, so it isn’t intended as a replacement for either.
How to choose the right amount of MedPay coverage
There’s no one-size-fits-all way to determine how much MedPay coverage you need. If you know that you would have trouble paying a deductible or co-pay associated with an accident, then you should consider maximizing your MedPay coverage.
If you have health insurance and are on firm financial footing, you should consider keeping your MedPay coverage relatively low or forego it altogether.
Where is MedPay available?
The availability of MedPay depends on where you live in the U.S. It’s optional coverage in many states, but a few actually require you to have MedPay as a part of your car insurance policy.
MedPay is required in these states:
- New Hampshire (required if opting for insurance coverage)
MedPay is not available in these states:
- New York
- North Dakota
Medical payments coverage is optional in every other state.
Regardless of whether or not MedPay is offered in your state, you do need bodily injury protection when it comes to paying the medical bills associated with injuries suffered in a car accident. This could be in the form of your health insurance, personal injury protection (if offered), or some other means of coverage.
How much does MedPay cost?
In most instances, MedPay coverage is less than $10 a month, and MedPay doesn’t require the policyholder to pay any deductibles or co-pay in conjunction with a claim.
What’s the difference between liability coverage and medical payments coverage?
Liability car insurance is required in every state except New Hampshire. Part of your liability insurance is bodily injury liability, which is designed to pay for the medical bills of anyone you might injure while driving your insured vehicle. MedPay is designed to protect you and your passengers, regardless of who is at fault.
What’s the difference between personal injury protection and medical payments coverage?
In addition to MedPay, some states also have something called personal injury protection (PIP) insurance. PIP covers a wider range of medical costs not covered by MedPay. PIP is normally the primary insurance, while MedPay serves as a secondary coverage. MedPay doesn’t have a deductible; PIP sometimes does.
How MedPay works with your health insurance
Only after your PIP insurance (if you have it) and your MedPay coverage has paid out does your health insurance kick in.
Once you receive a payout from any claim you filed against the other drivers, you will have to repay your car insurance company and health insurance for any payments it made on your behalf to cover your treatment.