What is Medical Payments Insurance?

wiseGEEK Writer

Medical payments insurance is a form of insurance offered by auto insurers. It is somewhat redundant in certain areas that require people to carry personal injury protection (PIP) insurance due to no fault laws, since it covers medical and/or funeral expenses after an accident. However, not all states require drivers to carry PIP, and in some cases PIP could be exceeded if expenses were very high and medical payments insurance might be useful.

Auto insurance might include coverage of medical payments in the event of injury.
Auto insurance might include coverage of medical payments in the event of injury.

Each plan detailing medical payments insurance will be different. In general these policies will cover, up to the amount insured, injury from accidents no matter who causes them. They also cover the passengers in cars, and they can cover a person who is walking down the street and gets hit by a car, or a passenger in someone else’s car, if their expenses exceed the driver’s medical payments insurance or PIP.

Medical payments insurance can cover funeral costs.
Medical payments insurance can cover funeral costs.

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There may be some good reasons to get medical payments insurance coverage. People without health insurance could definitely use it to meet any costs they have if they get in an accident. Sometimes physicians are loath to take patients who aren’t insured and who will have to wait for payments from someone else’s insurer, since these take a long time. Occasionally, health insurers may decline to pay costs of an injury or accident if they can prove that someone else (like a driver) should pay them. Having immediate access to medical payments without having to consider fault may be a very good thing.

Others suggest this form of insurance is relatively unnecessary and a waste of money. Especially if people have health insurance and carry PIP, they may not need this additional coverage. Prices on it can vary greatly. It might not be very expensive to add medical payments insurance, but many feel this is overlapping coverage that is usually not required. On the other hand, those who are not carrying personal injury protection and who have medical insurance with high deductibles, might definitely consider getting at least enough coverage to meet deductible payments, should it be necessary.

It should also be considered that medical payments insurance can cover the costs of funerals. This might already be covered through life insurance or other means, but if it isn’t, the expense of adding extra coverage may be justified. While no one wants to think of an accident causing death, no one wants to deal with huge expenses after suffering an enormous loss. There could certainly be some benefit in this insurance as a form of funeral/burial coverage, and it may be available no matter which driver was at fault.

People can talk to their insurance brokers about the benefits of medical payments insurance. It’s wise to ask insurers why they want a person to buy this type of insurance and what exactly it covers that is not included elsewhere in health or auto insurance plans. A reputable insurer will certainly admit if no benefit is gained from adding medical payments to a policy.

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