6.3 Part B Medical Payments

Part B: First-Party, No-Fault MedPay

Part B - Medical Payments (commonly MedPay) is first-party, no-fault coverage. It pays reasonable expenses for necessary medical and funeral services because of bodily injury caused by an auto accident - regardless of who was at fault. Because fault is irrelevant, Part B often pays quickly while a Part A liability claim is still being investigated.

Key scope rules: covered medical expenses must be incurred within three years of the date of the accident. Part B is a per-person limit (e.g., $5,000 each person), not a per-accident pool, so multiple injured insureds each access the full limit.

Who Is Covered and In What Capacity

Part B covers two classes of insured in different ways:

The pedestrian trap is heavily tested: the named insured and resident family members are covered for medical expenses even when struck by a car while walking - they do not need to be in a vehicle. A non-family passenger, by contrast, is covered only while in your covered auto, not as a pedestrian.

Per-Person Limit Math and Coordination

Because Part B is a per-person limit, count each injured insured separately.

Worked example: A PAP carries a $5,000 Part B limit. An accident injures the driver ($3,200 in bills), one front passenger ($6,800), and one rear passenger ($1,500), all insureds while occupying the covered auto. Part B pays: driver $3,200, front passenger $5,000 (capped from $6,800), rear passenger $1,500 = $9,700 total across the three, even though each shares the same $5,000 per-person figure.

Part B is generally excess over any PIP (no-fault) benefits and may coordinate with health insurance, but it does not pay the same dollar twice. After paying, the insurer may exercise subrogation against an at-fault third party to the extent of its MedPay payment where state law allows.

Part B Exclusions and Common Traps

MedPay does not apply in several situations the exam loves:

• Injury while occupying a vehicle with fewer than four wheels (e.g., a motorcycle).
• Injury while using a vehicle as a public or livery conveyance (taxi/rideshare for a fee), except a share-the-expense car pool.
• Injury during the course of employment if workers' compensation is available (WC is primary).
• Injury while occupying a vehicle (other than your covered auto) owned by the named insured or a family member but not insured under this policy (the "owned-but-not-insured" exclusion).
• Injury sustained while the vehicle is used in the business of selling, repairing, parking, or storing autos.

Note that Part B is distinct from Part A: Part A pays others' injuries when the insured is liable; Part B pays the insured's own medical bills regardless of fault.

Med Pay: No-Fault, Small, and Broad

Part B Medical Payments pays reasonable medical and funeral expenses for bodily injury to a covered person in a car accident, regardless of fault. It is a small, first-party benefit (limits commonly $1,000-$10,000 per person) and applies to the named insured and family members as occupants of any auto or as pedestrians struck by a vehicle, plus any other person occupying the covered auto.

Med Pay Exclusions and Coordination

Key exclusions tested: injury while the auto is used as a public/livery conveyance, while occupying a vehicle with fewer than four wheels (motorcycles), during business use of a non-owned vehicle, or while the insured is in a vehicle owned but not insured under the policy. Expenses must generally be incurred within 3 years of the accident. The exam also asks how Med Pay coordinates with PIP/no-fault and health insurance — in no-fault states like Minnesota, statutory PIP often replaces or supplements Med Pay, and policies prevent double recovery for the same expense.

Med Pay vs. Liability and Subrogation

A clean contrast the exam draws: Part B Medical Payments is first-party (pays the insured's own people regardless of fault), while Part A Liability is third-party (pays others the insured injures). Because Med Pay is a no-fault benefit, the insurer may seek reimbursement/subrogation if the injured insured also recovers from an at-fault party, preventing double recovery for the same medical bills.

Who Is Covered Under Part B

Covered persons are the named insured and family members while occupying any auto or as pedestrians, and any other person while occupying the named insured's covered auto. A passenger in the insured's car who is hurt collects under Part B even if the insured was not at fault — a frequent fact-pattern answer.

Excess and Coordination With PIP

Part B is generally excess over any other applicable auto medical or no-fault coverage when the insured occupies someone else's car, and primary for the insured's own covered auto. In no-fault states, statutory PIP benefits (wage loss, medical, replacement services) often respond first, and Med Pay coordinates so the insured is not paid twice for the same expense. Recognizing this primary/excess ordering between Med Pay, PIP, and health insurance is the core coordination point the exam tests for first-party injury benefits.