Auto insurance is not always affordable, especially if you live in a high-risk area, drive a nicer vehicle, or live in an expensive insurance state. Some states have a monthly average of under $100, while some breach the $200 mark. In fact, Washington, D.C. average $177 per month or $2,127 per year, while Virginia residents average $93 per month or $1,114 per year.
Because of the rising cost of medical care, some states now require personal injury protection (PIP) coverage and medical payments or MedPay coverage. These are two primary types of medical coverage attached to your insurance policy that help if you are in an accident.
Not all states require PIP or MedPay, and if it is not a requirement, you have your health insurance to fall back on. Even if it is not required, your insurance agent might suggest it as an add-on. Because while you have health insurance, medical payment coverage can help and possibly save you money.
Understanding How PIP and MedPay Works
PIP and MedPay help in fault and no-fault accident states. However, PIP is required when you live in a no-fault state. Most states are fault-based, which means that if you are in an accident, you can file a claim with the at-fault party’s insurance company for compensation. In a no-fault state, most of your losses (medical and lost wages) come from PIP coverage.
What PIP Covers
PIP insurance would cover your medical costs and injury-related expenses, regardless if you or someone else were at fault. The coverage varies based on the state’s policy. In general, you can expect compensation for the these items.
Medical Costs – This includes everything from ambulances, to hospitalization, to surgery, doctor’s appointments, prescription medication, medical equipment, rehabilitation, therapy, laboratory tests, and chiropractic care. You may have a copayment, or the PIP policy will cover these at 100 percent. Refer to your specific policy for details about any copayments.
Funeral Expenses – If a death results from that accident, PIP covers burial expenses, ceremonies, and cremation costs.
Lost Income – You can receive compensation for your lost wages from an injury. PIP might cover you even if you are self-employed – depending on the policy.
Child Care or Household Expenses – Some PIP policies will also cover the cost of childcare and the cost to maintain your home while you are injured.
Survivor’s Income Losses – If a loved one passes away in an accident and they were the primary income earner in the house, surviving loved ones may receive compensation from PIP for the loss of income.
If your state does not require PIP insurance, you may not need PIP in addition to auto insurance and health insurance coverage.
What MedPay Covers
MedPay is not as comprehensive as PIP. Instead, it covers your medical expenses. It also covers other drivers listed on your policy, members of your household, and passengers in your vehicle. However, the coverage is limited to medical expenses only.
Even if MedPay is not required, it might be in your best interest to add this coverage along with your automobile and health insurance policies.
MedPay Works as a Primary and Supplemental Policy
MedPay can be used in two ways: to supplement current health insurance coverage or work as direct reimbursement for medical costs after an accident.
Some insurance companies will have you file claims with your MedPay policy before filing with your health insurance. Other times it works to cover health insurance gaps.
As a supplemental policy, MedPay can be beneficial, especially if you are in an accident with a driver that is underinsured or uninsured and you have extensive medical costs. For example, you are involved in a crash with a driver without insurance. Your health insurance would typically pay for the accident medical coverage. However, you have $1,000 deductible plus high copays. In this case, you can use MedPay to cover those out-of-pocket medical expenses, including covering the deductible and office co-pays that health insurance does not cover – ensuring you do not pay anything for the accident.
The Benefits to Using MedPay along with Health Insurance
You may still want medical payment coverage in your auto insurance policy despite your health insurance.
Some health insurance policies do not cover accident injuries. Read your health insurance policy carefully, because some insurers do not cover injuries in an accident. That means you would be responsible for the medical expenses personally. MedPay can reimburse you for the costs that health insurance does not cover.
Coverage while out of state. MedPay would handle claims even if you are in an accident out-of-state. Your health insurance may charge you out-of-network fees for your medical expenses, which would be out of your pocket. With MedPay, these fees are covered.
Accidents as a passenger. If you are a passenger in a vehicle, that driver’s MedPay can cover your medical costs as a primary coverage or supplemental to what your health insurance covers.
Protecting your passengers. Your passengers may not have health insurance or have limited health insurance coverage. If you have MedPay, your policy also covers them. This means any family members or friends in your vehicle would receive 100 percent medical payment coverage.
Injured in an Accident? Speak with an Injury Attorney
After a severe accident, figuring out policies and handling claims is not something you should worry about. Instead, you need an accident attorney to review the coverage available to you and help file claims so that you can receive the compensation you need to recover from your injuries.
Speak with an attorney from Koonz, McKenney, Johnson, DePaolis & Lightfoot, LLP today. We have offices in District of Columbia, Maryland, and Virginia, and you can also reach an attorney online through our contact form.