Introduction to Medical Payments Coverage

Everyone has seen the ‘Medical Payments’ section on their Homeowner's or Auto policy, but what does it really mean? Does it cover my medical expenses if I get in a car crash? Does it mean that I only have coverage for X amount of dollars for other people's medical expenses? Does it cover my family's medical expenses?

Medical Payments in the Homeowner’s & General Liability Policies:

The Medical Payments (also referred to as 'Medical Expenses coverage') section of your Homeowner’s or General Liability policy is to cover the medical expenses of someone who is injured through no fault of your own: in other words, they were injured but not because you were negligent.

For example, this could be someone simply tripping over their own feet in your store and needing to seek medical treatment. In this case, Medical Payments coverage would pay for the first aid costs your provide and also for the injured person's medical bills, up to the Medical Payments limit.

The best way to think of this coverage is as 'goodwill', meaning that you don't legally owe them anything, but your insurance will pay to make sure they're alright. The benefit of this coverage is that it will make the customer happy that they didn't have to pay out-of-pocket to see a doctor and it will also (hopefully!) avoid a lawsuit over a small incident. However, should the person need medical attention that exceeds the Medical Payments limit (or if you were negligent), they will have to sue you to get more than the Medical Payments limit, and that's when your Per Occurrence liability limit will be triggered and will start defending you. 

Note that the Medical Payments coverage for Homeowner's/Renter's will not pay for the injuries to you, your family, or household residents because that is best insured by health insurance. For businesses, the Medical Payments coverage would not apply to you or your employees, because that's why there is Workers' Compensation.

Medical Payments in an Auto Policy:

The concept is almost reversed in auto insurance. Regardless of your negligence in an accident, your insurer is going to pay up to the Medical Payments limit for each person in the car. So when you're the driver and have an accident, it'll pay for the medical expenses of you and every passenger in the vehicle. This coverage also extends to when you are a passenger in someone else's car, or if you are hit by a vehicle while on-foot. 

The Auto policy's version can be very beneficial to have if you are the passenger during an accident or hit as a pedestrian. This is especially so if the driver doesn't have Medical Payments coverage (or auto coverage at all!). Alternatively, the driver might have an Auto policy, but they might not have high enough limits to fully cover your injuries!