If you`re trying to save money on your auto insurance, you might be considering removing MedPay, also known as medical payments coverage, from your policy. MedPay isn`t required by every state and may seem unnecessary if you`ve already got health insurance. But MedPay can cover you in situations where your health insurance is lacking and cover thousands of dollars in medical costs that would otherwise come right out of your pocket.
In its basic form, medical payments coverage covers car accident medical costs for you and other people in your car, such as family members, up to your MedPay limit. The coverage is effective even if you or someone in your car is at fault in the accident.
While the other driver`s insurance is ultimately responsible for your medical bills if they`re who`s at fault in an accident, the settlement process can drag on for months and you`re stuck paying co-pays and deductibles on your health coverage in the meantime. This is where MedPay kicks in.
MedPay covers your deductibles, co-payments and a variety of other expenses your standard health insurance policy doesn`t include, such as prosthetics, dental work, chiropractic, fees for the ambulance and even funeral costs. In no-fault states, which include New York and Utah, MedPay may cover the required co-pay for the personal injury protection part of your auto policy, which covers lost wages and medical costs arising from a car accident. Depending on your policy`s terms, the MedPay may activate at 100 percent automatically after you`ve used all your personal injury protection coverage.
The premiums for medical payments coverage on your auto insurance are often very low, such as $20 annual for a maximum $10,000 coverage limit. The cost versus coverage is quickly realized in the case of an accident. For example, if you`re in a car accident and have $3,000 in medical costs with a $1,000 deductible on your health insurance, you`ll pay $1,000 out of your pocket without MedPay. But if you have the medical payments coverage, you`ll pay nothing.
MedPay coverage limits are set by person as opposed to total dollar coverage. For example, if you have a medical payments coverage limit of $10,000 shown on your policy, the limit applies to each covered person. So, if you and your covered spouse are both injured in an accident, MedPay will cover up to $10,000 in eligible expenses for you and your spouse for a total of $20,000.
Consider raising your MedPay coverage limits if you don`t have health insurance or the funds to cover emergency costs in the event of an accident. Keep in mind that MedPay is not a substitute for health insurance, as it only covers medical expenses related to an auto accident.
Having enough insurance in the event of an accident is one of the common Money Tips out there and for good reason. MedPay can help to protect you and your family from financial distress in the event of a car accident. This coverage will give you peace of mind.
