What is medical payments coverage?

Young man with broken leg sitting on sofa and looking up medical payments coverage on his phoneImage: Young man with broken leg sitting on sofa and looking up medical payments coverage on his phone

In a Nutshell

Medical payments coverage can help pay for your or your passengers’ medical or funeral expenses after an accident — even if the accident is your fault. This type of coverage is generally optional, but it’s required in a few states. Medical payments coverage is similar to personal injury protection coverage, which offers more comprehensive coverage but is only available in no-fault states.
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If you or your passengers are injured in a car accident, medical payments coverage can help you pay for the medical expenses — no matter who’s at fault.

Medical payments coverage — which is sometimes called med pay — also often helps cover medical and funeral expenses if you or a family member is injured while walking or riding in another vehicle.

While this type of coverage may provide similar benefits to your health insurance, it can help fill any coverage gaps and cover your health plan deductibles and copays.

Let’s take a look at how medical payments coverage works, where it’s required and how it differs from other types of auto insurance coverage.



How does medical payments coverage on auto insurance work?

Medical payments coverage can help cover medical expenses if you or your passengers are injured in an accident — no matter who caused the accident.

Medical payments coverage can help cover a range of expenses, depending on your policy. Here are some of them.

  • Health insurance deductibles and copays
  • Doctor and hospital visits
  • Surgeries
  • X-rays
  • Chiropractic treatment
  • Ambulance fees
  • Prosthesis
  • Dental care
  • Nursing services
  • Funeral expenses

Say you’re in a car accident where you hit another driver, and you and your passengers are injured. Everyone receives medical treatment, and the total cost is around $20,000.

Who pays for these medical expenses?

Your health insurance may cover some of your costs. Medical payments coverage can fill some gaps by helping to cover your passengers’ expenses and any of your medical expenses that health insurance may not cover — up to the coverage limit. You choose the coverage limit when you buy medical payments coverage. Expenses beyond that limit would need to be paid out of pocket.

But if you don’t have medical payments coverage, you’d be responsible for paying your medical expenses that health insurance doesn’t cover out of your own pocket.

Medical payments coverage versus bodily injury liability insurance

While both medical payments coverage and bodily injury liability insurance help pay for medical expenses, they each cover different parties.

Medical payments coverage helps cover your and your passengers’ medical expenses, while bodily injury liability insurance helps pay for the other driver’s medical expenses — but only if you cause the accident.

Is medical payments coverage required?

Medical payments coverage is typically optional in fault states — but it’s required in New Hampshire and Maine, which are both fault states, and in Pennsylvania — a fault/no-fault hybrid state.

In a state with no-fault insurance laws, each driver’s insurer pays that driver’s medical expenses — up to a certain limit — after an accident. This is different from a fault state, where the at-fault driver’s insurance company pays for medical expenses incurred by both drivers and any passengers, up to a limit.

In no-fault states, drivers may be required to buy personal injury protection, or PIP, which is similar to medical payments coverage.

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What’s the difference between PIP and medical payments coverage?

PIP is similar to medical payments coverage — it can help pay for your or your passengers’ medical bills or funeral expenses after an accident, no matter who’s at fault.

But depending on your state, PIP may also help cover some expenses that medical payments coverage doesn’t cover, like lost wages and childcare expenses if you can’t work or care for your kids due to injuries from an auto accident.

And there’s another key difference between PIP and medical payments coverage: PIP may be required or optional in no-fault states, while medical payments coverage is typically available in at-fault states.


What’s next?

If you live in Pennsylvania, New Hampshire or Maine, you need to get medical payments coverage. But if you live in a state where coverage is optional, it could be a worthwhile addition to your auto insurance policy. It could be especially helpful if you have a high health insurance policy deductible or low health coverage limits, and you’d have trouble paying for medical expenses out of pocket. An insurance agent can help you determine whether this coverage makes sense for you.

When shopping for car insurance, be sure to gather and compare several quotes to find the auto policy that best fits your needs.


About the author: Erik Deckers is a professional blogger and ghostwriter, and is the co-author of Branding Yourself, No Bullshit Social Media, and The Owned Media Doctrine. Erik has been blogging since 1997, and he’s been a newspaper h… Read more.