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From 2019 to 2020, 3.8 million people visited an emergency room due to car crash-related injuries, according to the CDC. Without health insurance, receiving medical care after a car accident could leave you with a hefty bill. Thankfully, medical payments coverage can help pay for medical expenses after a collision. This optional coverage can help cover medical costs for you and your passengers, regardless of fault. But is medical payments coverage worth it if you already have health insurance?

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What Is Medical Payments Coverage? 

Medical payments coverage, also called MedPay, is an optional add-on insurance that covers medical expenses (up to your policy’s limits) for you and your passengers following an accident, even if you’re found at fault. MedPay can also cover your out-of-pocket costs, such as your deductible or co-pay if you have health insurance. MedPay coverage isn’t available in all states and is only legally required in Maine and New Hampshire.

Medical payments coverage can help pay for the following expenses after a car accident:

• Doctor visits
• Hospital care
• Nursing services
• Ambulance and emergency services fees
• Surgeries and X-rays
• Health insurance deductibles and co-pays
• Funeral expenses

Do I Need Medical Payments Coverage if I Have Health Insurance? 

In most states, the decision to purchase MedPay will depend on your financial situation and what types of coverages you already have. If you do not have health insurance, MedPay is likely worth the cost due to how expensive a trip to the ER can be. However, MedPay should not act as a replacement for health insurance. 

Even if you already have health insurance, MedPay coverage can help you lower costs in other ways. For example, suppose you have a health insurance plan with a high annual deductible. In that case, MedPay can cover the cost of your deductible and other out-of-pocket expenses. Additionally, if you’re involved in a car accident, your personal health insurance won’t apply to any passengers in the car—MedPay will.

Understanding MedPay Coverage Limits 

Like most insurance coverages, MedPay has coverage limits, representing the maximum amount an insurer will pay per person per covered accident. When you purchase medical payments coverage, you can select your coverage limit, with average amounts ranging from $1,000 to $10,000.

When selecting your limits, consider any other health insurance you may have. If you choose coverage limits that are higher than your health plan’s deductible, it can help you limit your out-of-pocket medical costs after an accident.

Doesn’t My Bodily Injury Liability Insurance Already Cover Medical Expenses? 

Liability insurance is required in nearly every state and covers bodily injury and property damage. However, it does not cover your own injuries or damaged property. Liability insurance only applies when you’re found responsible for injuring someone else or their property.  

What’s the Difference Between MedPay and Personal Injury Protection (PIP)?

MedPay isn’t offered in every state but is optional in most. States without MedPay typically require motorists to have personal injury protection (PIP) coverage, which also covers medical expenses for you and your passengers regardless of fault. States that require PIP are referred to as no-fault states. Drivers in no-fault states must file a claim with their insurance company for the cost of their injuries, regardless of who is at fault for the accident.

Although similar, there are a few key differences between medical payments coverage and PIP:                      

1. PIP coverage is sometimes optional and sometimes required. Medical payments coverage is almost always an optional add-on.
2. PIP coverage can extend towards lost wages if you cannot perform essential duties due to injuries sustained in a car accident. Medical payments coverage does not extend towards lost wages.
3. PIP is required in no-fault states. Medical payments coverage is only offered in states that do not have PIP.

Still Have Questions? Speak With an Insurance Specialist 

With so many available coverages, knowing what insurance you should have can sometimes feel overwhelming. Although you must carry liability insurance in most states, multiple add-on coverages may or may not be worth purchasing, depending on your vehicle and lifestyle.

Whether you have questions regarding increasing coverage, switching providers, or searching for auto insurance quotes, AIS can help. Our team of insurance specialists have the knowledge to guide you through the insurance marketplace to find coverage you can feel confident in. To speak with an insurance specialist, call (888) 772-4247.

The information in this article is obtained from various sources and offered for educational purposes only. Furthermore, it should not replace the advice of a qualified professional. The definitions, terms, and coverage in a given policy may be different than those suggested here. No warranty or appropriateness for a specific purpose is expressed or implied.

When purchasing car insurance, many drivers believe they can save by only buying what is legally required in their state. However, doing so could leave you with a large expense if your car is damaged in an event outside your control, such as theft, vandalism, or an act of nature. To have peace of mind knowing you are covered in these situations, you’ll need comprehensive coverage.

Comprehensive coverage pays for your vehicle’s repair or replacement costs if it is damaged in a covered non-collision event, up to your policy’s limits. Comprehensive car insurance isn’t required in any state, but a lender may require it as a condition of your finance contract or lease.

What Does Comprehensive Car Insurance Cover? 

Comprehensive coverage will cover the cost to repair or replace your vehicle (up to your policy’s limits) if it is damaged from…

• Car theft
• Vandalism, including catalytic converter theft
• Fire and explosions
• Falling trees, debris, and other objects
• Windshield damage from rocks or objects kicked up by other cars
• Storms, hail, wind, lightning, and earthquakes
• Interactions with a wild animal

Comprehensive insurance will not cover any of the following incidents:

• Damage to your vehicle that was caused by a collision with an object, or another vehicle regardless of fault (covered by collision insurance)
• Damage to someone else’s vehicle or property (covered by property liability insurance)
• Medical bills for another motorist as a result of an accident you caused (covered by bodily injury liability insurance)

Does Comprehensive Insurance Involve a Deductible? 

When you purchase comprehensive coverage, you’ll have the option of choosing your set deductible. In car insurance, a deductible represents the amount you must pay out of pocket towards a claim before your insurer handles the rest, up to your policy’s limits.

Most insurers allow you to select your deductible amount, with the most common deductibles being $250, $500, or $1,000. As a general rule of thumb, the higher your deductible is, the lower your coverage premium will be. Think of it as a trade-off:

• A lower comprehensive coverage deductible = a higher comprehensive coverage premium 
• A higher comprehensive coverage deductible = a lower comprehensive coverage premium 

Will Comprehensive Car Insurance Replace My Vehicle? 

Comprehensive coverage will pay repair and replacement costs for your vehicle, but only up to your policy’s limits. Exact limits may vary, but most providers cap payouts at your vehicle’s market value right before the accident. This is also called your vehicle’s actual cash value (ACV).

For example, let’s say your car’s ACV is $20,000, and you carry comprehensive coverage with a $500 deductible. One morning, you wake up to find that a tree branch has fallen onto your car, which causes significant damage. You contact your insurance provider, settle your $500 deductible, and wait to see if your vehicle can be repaired. If an auto shop can repair your vehicle, your insurance will cover repair costs up to your vehicle’s ACV minus the deductible. If your car cannot be repaired, your insurance will reimburse you for your car’s ACV minus the deductible, or $19,500, for you to put towards the cost of a replacement vehicle.

Do I Need to Purchase Comprehensive Coverage? 

As mentioned, comprehensive coverage isn’t typically required unless you finance or lease a car. If you own your car outright, you can decide whether comprehensive insurance is worth purchasing.

If you’re not sure whether comprehensive coverage is right for you, consider the following:

• Your car’s value: The value of your car plays a significant role in comprehensive coverage because limits are usually capped at your vehicle’s ACV. If you have an expensive car, the add-on coverage is most likely worth it to help pay for any repairs or replacement costs down the line. However, purchasing comprehensive coverage is not worth it if your vehicle is worth less than your plan’s deductible plus the cost of coverage.

• Your financial situation: If you had to replace your vehicle tomorrow, could you cover the cost? If not, comprehensive coverage could give you peace of mind knowing you are protected against unforeseen events.

What’s the Difference Between Comprehensive and Collision Coverage? 

You will typically see comprehensive coverage bundled alongside collision coverage when shopping for car insurance. Although both coverages pay for damage to your vehicle, the two cover different scenarios.

Unlike comprehensive coverage, collision coverage covers repair or replacement costs for your vehicle after a collision with another car or object, regardless of fault. Examples of covered collision events include crashing into another motorist, a single-car rollover, or a collision with a light pole. Collision insurance is also optional but may be required by a lender when financing or leasing.

Speak with an Insurance Specialist to Learn More

It’s important to look for auto insurance savings whenever possible, but rejecting certain add-on coverages could cause you to pay more for a repair or replacement in the future. If you’re unsure which add-on insurance coverages are right for you, AIS can help. 

Our team of insurance specialists can guide you through the options available and know what questions to ask to ensure you’re fully covered. To speak with an AIS specialist today, call (888) 772-4247.

The information in this article is obtained from various sources and offered for educational purposes only. Furthermore, it should not replace the advice of a qualified professional. The definitions, terms, and coverage in a given policy may be different than those suggested here. No warranty or appropriateness for a specific purpose is expressed or implied.