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What Is the Medical Payments Coverage?

By :Douglas A. Petho
Medical payments coverage or “med pay” as it is often referred to, is an optional form of insurance that may be purchased in connection with an automobile liability insurance policy. Under this coverage, the insurer agrees to pay all reasonable expenses incurred for necessary medical and funeral services because of bodily injury caused by accident and sustained by an insured.

Expenses are considered “reasonable” only if they are consistent with the usual fees charged by the majority of a similar medical provider in the geographical area in which the expenses were incurred.

Services are “necessary” only if the services are rendered by a licensed medical provider within the scope of the provider’s practice and license and are essential in achieving maximum medical improvement for the bodily injury sustained in the accident.

Most policies limit coverage to those expenses incurred for services rendered within three years from the date of the accident.

When does Medical Payments Coverage apply?

Medical payments coverage provides broader protection than one might think. It applies to any named insured or any family member while occupying or as a pedestrian when struck by a motor vehicle designed for use mainly on public roads or a trailer of any type. It also provides coverage to any other person while occupying a covered auto or any other motor vehicle operated by an insured or the family member if the motor vehicle is a private passenger auto or trailer.

How much coverage is available?

Medical payments coverage is sold in varying amounts at different premiums. Coverage can be as little as $500 to as much as $1 million.