What Is Medical Payments Coverage (MedPay)? – MarketWatch

Medical payments coverage (MedPay) is a relatively common add-on for car insurance policies. While many people opt for this type of auto protection, they may not understand how it works or how it differs from similar types of insurance, such as personal injury protection (PIP).

We at the Home Media reviews team will tell you everything you need to know about MedPay insurance, including what it covers, how it differs from other forms of insurance and whether your state requires it. We’ve researched and ranked the industry’s best car insurance companies to find out which ones have the greatest protection, so we’ll also recommend two top providers that offer MedPay.

Medical payments coverage (commonly known as MedPay) helps pay medical bills for you and other passengers after a car accident. MedPay takes care of your medical costs regardless of who caused the collision. It also covers you if you were involved in a car accident as a pedestrian.

Minimum coverage auto insurance typically only pays for damages to the other driver and their passengers when you cause an accident, so without medical payments coverage, you’ll be on your own to cover your hospital and doctor expenses. MedPay isn’t available in every state.

Medical Payments Coverage vs. Liability Insurance

Bodily injury liability insurance, unlike medical payments coverage, is required for drivers in nearly every state. This type of protection pays for some of the expenses faced by other drivers and their passengers after you cause an auto accident.

Keep in mind that none of your medical bills will be covered by bodily injury liability insurance if you’re at fault for an accident. That’s one reason why drivers often consider adding MedPay coverage to their policies.

Medical Payments Coverage vs. Personal Injury Protection

Both MedPay and personal injury protection (PIP) pay for your medical expenses after an at-fault accident, but you’ll find several differences between these two types of car insurance.

• States available: PIP mainly gets purchased in no-fault states, while MedPay is available in at-fault states. In at-fault states, the auto insurance of the driver who caused an accident pays for damages to both parties. In places with no-fault insurance laws, each driver’s medical expenses are covered by their own insurance.
• Deductible amount: There’s typically no deductible for MedPay, while there’s usually one for PIP. There’s also generally a health insurance deductible for motorists who plan to use that coverage.
• Extent of coverage: MedPay is limited in scope compared to PIP insurance. While MedPay covers expenses directly related to health needs, PIP expands coverage to include lost wages and necessary child care costs.
• Cost of coverage: MedPay tends to be cheaper than PIP coverage because its coverage isn’t as extensive.

Not all drivers can choose between MedPay and PIP, but those who can should carefully weigh their potential costs and coverage limits.

When policyholders opt for MedPay coverage, they gain access to limited payouts for health expenses. The maximum payout applies to each person who’s covered. The following situations will likely qualify for medical payments coverage:

• Trips to the hospital
• Doctor visits
• Charges for X-rays, surgeries and prostheses
• Nursing services and rehabilitation costs
• Medical deductibles and copays
• Ambulance fees
• Funeral expenses

Read your auto policy’s fine print for your coverage limits, as MedPay usually comes with low payouts for medical and funeral costs.

Medical payments insurance coverage typically costs between $5 and $10 per month. However, your MedPay rate will largely depend on your insurance provider’s payout limit. Car insurance quotes may also be higher for drivers who live in areas where accidents are more likely to occur.

You probably won’t find a company that’s willing to cover an unlimited number of medical treatments, but each company may offer choices for your maximum allotment.

You must purchase medical payments coverage if you’re a driver living in one of the following states:

For motorists in other states, MedPay is optional coverage. Those who feel comfortable paying for unexpected medical bills after a car accident may be fine avoiding MedPay. But because it’s such a cheap car insurance option, most drivers would be smart to add it to their policies for peace of mind.

If you’re looking for auto insurance that includes exceptional medical payments coverage, consider Geico and State Farm. Both of these companies typically have below-average rates and receive relatively strong marks for their customer service.

Geico: Editor’s Choice

Drivers who choose Geico often find some of the lowest car insurance rates on the market, and the company’s affordability has earned praise from customers. Geico received an above-average score in the J.D. Power 2021 U.S. Auto Claims Satisfaction Study℠, showing that drivers face relatively few issues receiving payouts.

Geico also holds an A++ financial strength rating from AM Best, so drivers won’t need to worry about whether their potential claims can be paid for.

Keep reading: Geico insurance review

State Farm: Most Popular Provider

More drivers turn to State Farm for car insurance than any other provider, and that may be due to its low rates and exceptional service standards. The company ranked in the top three for nearly every region in the J.D. Power 2021 U.S. Auto Insurance Study^SM, revealing that most customers enjoy its offerings.

State Farm is known for its local agents, who often make the provider feel more personal than other insurers. Due to its size and excellent financial health though, drivers won’t have to worry about coverage after an accident.

Keep reading: State Farm insurance review

Because consumers rely on us to provide objective and accurate information, we created a comprehensive rating system to formulate our rankings of the best car insurance companies. We collected data on dozens of auto insurance providers to grade the companies on a wide range of ranking factors, from reputation, to accessibility, to coverage options to customer satisfaction. The end result was an overall rating for each provider, with the insurers that scored the most points topping the list.

In this article, we selected companies with high overall ratings and cost ratings. The cost ratings were informed by auto insurance rate estimates generated by Quadrant Information Services and discount opportunities.

*Data accurate at time of publication.