What Is Medical Payments Coverage For In An Auto Insurance Policy?

By Author: Jerry Pickett
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Medical payments coverage is one of the optional components of an auto insurance policy that insures against otherwise uninsured medical expenses in a car accident. It's one of the types of auto insurance that is not legislated in all states across the US, but can be extremely valuable to the insured.

Some people think that medical payments coverage is a duplication of their health insurance, or that their medical expenses are covered under bodily injury coverage. Others think that medical payments coverage is an essential component of auto insurance. How do you decide whether to add it to your policy? Here are some things to consider when making your decision.

The Components of an Auto Insurance Policy
An auto insurance policy is made up of several different components. The types of insurance are typically bodily damage or personal liability, which relates to injuries obtained in an accident; property damage liability, which covers the costs of repairs to property damaged in an accident; physical damage, which covers the costs of repairing your vehicle; collision damage, which is specific to motor vehicle ...
... accidents; comprehensive damage, which covers storm damage or a broken windshield, for example; underinsured or uninsured motor insurance, which fills the gap if you are in a collision where the guilty party does not have adequate insurance; and medical payments coverage, which insures against additional medical expenses.

What Specifically Does Medical Payments Insurance Cover?
Medical payments coverage will pay for medical bills for the driver and passengers of the vehicle in the event of an accident. It would also cover you if, as a pedestrian or cyclist, you are involved in a motor vehicle accident. The coverage will be paid out to you regardless of who is at fault. Depending on the type of policy, medical payments coverage may also extend to the policy holder and their family even if they are traveling in someone else's car. This coverage includes ambulance and paramedic services, hospital bills, surgery and doctor's bills, x-rays, blood tests, medication, physiotherapy and other rehabilitative treatments. There is usually a capped limit on the payout in the event of a claim and this limit is decided by the type of policy that is taken out.

What is the Difference Between Medical Payments Coverage and Personal Injury Coverage?
The two insurance types are very similar and in most states medical payments coverage is an optional extra for auto insurance. Personal injury insurance will cover the medical expenses of the driver and passengers in the event of an accident. In addition to covering medical expenses, personal injury insurance can also help recover lost wages due to hospitalization and injury, child care services, and other related expenses.

When Should You Consider Getting Medical Payments Coverage?
Medical payments coverage is usually recommended for people who are carpooling or regularly traveling with groups of people. It is also recommended where you have only a very basic or limited health insurance policy that would not cover extensive hospitalization of medical treatments in the event of an accident. Basically it is a top-up policy. The reason it's recommended for people that carpool is that if, for example, you have a policy that has coverage of $100,000 on personal injury insurance, that amount will be divided among the number of passengers in the vehicle at the time of the accident. So if all four people were injured and required hospitalization, the coverage would only be $25,000 each. If surgery or extensive medical treatments were required, this amount would be exhausted very quickly, leaving the individuals to foot the balance of the bill. If you had an additional medical payments policy, that could cover the medical expenses once your personal injury policy has been exhausted.

Do you Need Medical Payments Coverage if You Have Health Insurance?
Medical payments coverage is an optional extra for auto insurance, but because medical expenses can accumulate quickly after a motor vehicle accident, the coverage can help offset costs beyond what basic health insurance covers. If you have a comprehensive health insurance policy that provides extensive cover for you and your family, you may feel that you are adequately covered and do not require medical payments coverage. If, however, you are a young professional that leads a healthy and active lifestyle and has only a basic health insurance policy then you may want to consider medical payments coverage. A basic health insurance policy may only cover hospitalization and related treatments. If you have to have surgery, it may not cover additional bills such as the anesthetist, physiotherapy, medication and other rehabilitative treatments. The important thing is to know the extent of your coverage under your health insurance policy and your personal injury policy and decide if you are satisfied with the level of coverage provided. If not, you can look at medical payments coverage as part of your auto insurance policy.
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