6.3 Part B Medical Payments

What Part B Pays

Part B — Medical Payments is first-party, no-fault coverage. It pays reasonable expenses for necessary medical and funeral services because of bodily injury caused by an accident and sustained by an insured. Because it is no-fault, Part B pays the insured's own medical bills regardless of who caused the accident — there is no need to prove the other driver was at fault.

Covered expenses must be incurred and the services rendered within three years of the date of the accident. Limits are typically modest and written per person, with common offerings of $1,000, $2,000, $5,000, or $10,000 per person. The limit applies to each insured injured in the accident, not to the accident as a whole.

Who Is an Insured Under Part B

Part B uses an occupancy-based definition that differs from Part A:

1. "You" and any family member while occupying any auto, or as a pedestrian struck by a motor vehicle (or a trailer of any type).
2. Any other person while occupying "your covered auto."

Key distinction: The named insured and family members are covered as occupants of any auto and as pedestrians. Anyone else (a passenger, a friend) is covered only while occupying your covered auto — and is not covered as a pedestrian.

"Occupying" is defined broadly as in, upon, getting in, on, out, or off a vehicle. That definition pulls in injuries that happen while loading, unloading, or stepping onto a running board — not just while seated inside.

How Part B Coordinates with Other Coverages

Part B is intentionally narrow but fast. It pays the insured's immediate medical bills without litigation, then the insurer typically pursues subrogation or coordinates with other coverages:

• If the at-fault party's Part A liability later pays the injured insured, the medical payments insurer may recover what it advanced (subrogation), preventing a double recovery.
• Part B can stack on top of health insurance depending on state law and policy wording; in some states Part B is excess over health coverage.
• In no-fault (PIP) states, statutory Personal Injury Protection often replaces or supplements Part B and may add lost wages and essential-services benefits that ordinary Part B does not provide.

Trap: Part B pays medical and funeral expenses only — it does not pay lost wages, pain and suffering, or rehabilitation income loss. Those broader first-party benefits come from PIP in no-fault states, not from standard Part B.

When a claim could be paid under both Part B and Part A (for example, an injured passenger in the insured's car who also has a liability claim against the negligent insured), Part B typically responds first because it is no-fault and pays quickly, and the insurer reconciles any overlap so the claimant is reimbursed for each medical dollar only once. Part B's medical focus also means an insured who needs wage replacement after a serious injury should look to a PIP endorsement, disability coverage, or a third-party liability recovery — never to medical payments alone.

Worked Example and Exclusions

Worked example

The named insured carries $5,000 per-person Part B. She and two passengers are injured when another driver runs a red light. Medical bills: insured $6,200, passenger A $3,000, passenger B $8,000.

Each injured person draws on a separate $5,000 limit, regardless of fault. The named insured and passenger B exhaust their limits; the $1,200 and $3,000 shortfalls would be pursued against the at-fault driver's Part A.

Major Part B exclusions

• Injury while occupying a vehicle with fewer than four wheels (e.g., a motorcycle).
• Injury while a vehicle is used as a public or livery conveyance (ride-share/taxi for hire), except share-the-expense car pools.
• Injury during business use of a pickup or van the insured does not own.
• Injury sustained while the auto is used in the auto business or while employed in any business of selling, repairing, or servicing autos (limited exceptions).
• Injury arising from war, nuclear hazard, or racing on a track.

What Part B Covers and Who Is an Insured

Part B - Medical Payments pays reasonable and necessary medical and funeral expenses incurred because of bodily injury caused by an auto accident, regardless of fault, if the expense is incurred within a stated period (commonly three years) from the accident. It is a small first-party, no-fault coverage designed to pay quickly without the litigation that Part A liability requires, and it covers medical, dental, surgical, ambulance, hospital, nursing, prosthetic, and funeral services.

The definition of insured under Part B has two layers tied to the accident situation. First, you and any family member are covered while occupying any auto or when struck as a pedestrian by any motor vehicle. Second, any other person while occupying your covered auto is covered. So a family member injured as a pedestrian or while riding in someone else's car is still covered under Part B, while a non-family passenger is covered only while in the insured's own covered auto, a distinction the exam tests with pedestrian and other-vehicle fact patterns.

Because Part B pays per person regardless of fault, each injured insured draws on a separate per-person limit, as the worked example shows; the limit is not divided among occupants. The shortfall above the Part B limit is pursued against the at-fault party's liability coverage, which is why Part B and Part A interact through the anti-duplication credit covered in the coordination section.

Worked scenario: a covered family member is struck by a car while walking across a parking lot. Even though no auto of the insured is involved, Part B pays the family member's medical bills up to the per-person limit because family members are covered as pedestrians. A non-family friend struck the same way would not be a Part B insured, since coverage for others requires occupying the insured's covered auto. Identifying who qualifies as a Part B insured in each accident situation is the core medical-payments skill.

Key Takeaways

Part B pays reasonable medical and funeral expenses for bodily injury from an auto accident, regardless of fault, if incurred within a stated period (commonly three years). Insureds are the named insured and family while occupying any auto or as pedestrians, and any other person while occupying the insured's covered auto. Each injured person draws on a separate per-person limit, and shortfalls are pursued under the at-fault party's liability coverage.