Medical payments coverage

What is medical payments coverage?

Medical payments coverage is a part of your auto insurance policy that provides for financial compensation for certain medical expenses and lost wages for you and your passengers who are in your vehicle when you’re involved in an accident while driving. Medical payments coverage is also known as personal injury protection coverage, or PIP.

Deeper definition

Medical payments coverage provides financial compensation for medical bills, dental care and funeral expenses that are the result of an automobile accident.

This coverage pays for expenses regardless of which driver is found to be at fault for causing the accident. Medical payments coverage provides compensation if you are injured by a driver while walking or riding your bicycle as well.

While medical payments coverage is optional in many states, there are some states that have made it mandatory to include this coverage in your insurance policy. The overall amount of coverage that is necessary varies from one state to another.

There also is medical payments coverage available on home insurance policies. The coverage provides financial compensation for injuries or accidents that occur on your property, protecting you as the homeowner from large monetary lawsuit payouts.

Find out how much medical payments coverage you need to protect yourself from a financial disaster.

Medical payments coverage example

Dennis Stollen was driving his vehicle when he was a victim of a hit and run accident. Bruce Jones was a passenger in Stollen’s vehicle at the time of the accident.

While Stollen wasn’t injured, Jones sustained injuries to his leg, neck and arm, which required medical treatment at a nearby hospital. Jones was transported to the hospital from the scene of the accident by ambulance.

His injuries were severe enough to cause him to stay in the hospital for three days. Furthermore, Jones had to miss six weeks of work due to his injuries.

Even though Stollen was not found to be at fault for the accident, since the other driver was unknown, Jones had to file for compensation for his medical bills and lost wages with Stollen’s insurance company. Having $10,000 in medical payments coverage, Stollen didn’t have to pay for the injuries and lost wages Jones encountered.

Know what matters when selecting bodily injury liability and personal property liability amounts for your auto insurance coverage.

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