Medical Payments Coverage: What It Is and How It Works with Auto Insurance
While states may set minimum car insurance coverage limits for vehicle owners, the owner often has options for increasing protections through optional policy additions and upgrades. Because of the risk of personal injury in vehicle collisions, it's often worthwhile to consider these additional auto insurance policies and protections that can reduce out-of-pocket medical treatment costs. Medical payments coverage is one such policy.
What Is Medical Payments Coverage (MedPay)?
Medical payments coverage (MedPay) is a type of auto insurance designed to cover medical expenses resulting from an auto accident, regardless of fault. The coverage typically extends to the vehicle owner, driver, and passengers.
This predominantly optional coverage — Maine, New Hampshire, and Pennsylvania (in some cases) are the only states that require it — has several similarities with personal injury protection (PIP), but they are not the same. MedPay is strictly a medical payments insurance policy. It covers:
- Medical and dental expenses
- Hospital bills
- Ambulance services
- X-rays and prosthetic devices
- Professional nursing services
- Funeral expenses
PIP insurance goes beyond the scope of medical costs. It includes damages like lost wages and possibly essential services, such as housekeeping and childcare, depending on your injuries.
With that said, is medical payments coverage needed for auto insurance? Not necessarily. In most states that offer the policy, it is optional.
How Does MedPay Work?
Medical payments coverage in auto insurance policies provides quick access to funds for medical bills, helping policyholders avoid out-of-pocket costs while waiting for the processing of other insurance claims. The fast funding is possible because fault doesn't factor in.
MedPay protection can extend beyond the driver and passengers of a vehicle. In some cases, the policy protects pedestrians and cyclists hit by a car. The policy restrictions depend on the insurance company and provider. It is best to talk to an insurer about your coverage limits and protections.
Factors To Consider When Choosing MedPay
When considering MedPay as part of a car insurance policy, evaluating several factors, including state requirements and existing health insurance policies, is crucial. While only a few states require MedPay, it's important to know how much medical payments coverage you need to meet state minimums. Failure to meet these minimums can result in fines and other penalties.
Most states don't require MedPay, but they may have timeframes for filing claims. Familiarizing yourself with such requirements can ensure you receive funds when needed.
A current health insurance policy may also affect how medical payments coverage works. For example, in some cases, health insurance acts as the primary coverage and MedPay as the secondary. The advantage in this scenario is that MedPay may cover your health insurance deductible. It can also help cover health insurance gaps, like copays and specific policy-prohibited medical treatments.
Beyond state requirements and health insurance, consider how MedPay fits into your budget and driving style. In most cases, medical payments coverage is inexpensive, but if your budget is strained by other obligations, adding any fee can be taxing. Also, if you don't usually drive with passengers and have a driving history free of accidents, the expense might be unnecessary, especially if you have a more comprehensive policy.
How To Purchase MedPay
Adding medical payments coverage to an auto insurance policy is a straightforward process. It typically takes only four steps:
- Contact your insurance provider: Ask about MedPay availability in your state and how it works with your current policy. Discuss policy limits and costs.
- Request a quote: Receiving a quote lets you see how the additional coverage affects your overall premium. The quote also allows you to compare costs against other insurance companies.
- Determine your coverage needs: When considering coverage limits, remember to factor in other insurance, such as health insurance. An insurance agent can help you determine the best coverage limits based on your insurance portfolio.
- Review and update your policy: If the coverage is favorable and you agree with the terms, your insurance agent will send over policy adjustment documents. Once you sign and return the documents, the MedPay coverage will begin. However, check with your insurer to ensure the effective date.
Before or after signing the policy agreement, talk to your insurer about the claims process. It's important to understand how to file a claim and whether medical payments are direct payments to medical providers or reimbursement payments to you.
Evaluating Different Insurance Providers
Choosing between car insurance quotes can be daunting without help. You have to weigh the costs and benefits of mandatory coverage and optional coverages while assessing the overall costs of any decisions.
Even the slightest change in a policy can have drastic effects on premiums and coverages. That's why choosing an insurance provider has to go beyond simple cost comparisons.
Evaluations should consider the details of the policy, including specific protections and limits. They should also consider the insurer. Look at a company's reviews and reputation, as well as its customer service accessibility and policy flexibility. Finally, remember to check its financial stability rating from a trusted source, such as A.M. Best or Standard & Poor's.
Seeking Professional Guidance
Medical payments coverage is an excellent addition to cheap car insurance, especially in states with limited access to PIP or other medical protections. While it's typically a beneficial and affordable policy addition, it may not be the right choice for everyone, especially if it affects your premium.
To ensure you're getting the most out of your insurance policy decision, use the free comparison tool from EverQuote. It allows you to compare quotes from several policies simultaneously, making it easier to see coverage differences.