6.3 Part B Medical Payments

Part B - Medical Payments Coverage

Part B pays reasonable and necessary medical and funeral expenses incurred because of bodily injury caused by a covered auto accident. Its defining feature is that it pays regardless of fault - it is a no-fault-within-the-policy first-party coverage. There is no requirement that the insured be legally liable; if a covered person is injured, Med Pay responds. This makes it the fastest source of injury payment after a crash.

Who Is Covered and When

Two categories of insured exist under Part B:

1. You and family members - covered while occupying any auto (owned or non-owned), and even as pedestrians struck by a motor vehicle designed for use on public roads.
2. Any other person - covered only while occupying your covered auto.

Expenses must be incurred within 3 years (36 months) of the date of the accident. The limit is a small per-person amount, commonly $1,000 to $10,000, and applies on a per-person, per-accident basis - not a single shared limit.

Worked Example - Per-Person Limit

Assume Med Pay limit of $5,000 per person. The named insured and two passengers are injured. Medical bills: insured $6,200; passenger A $3,400; passenger B $5,800.

Because the limit is per person, the insurer pays up to $5,000 for each injured person independently - there is no aggregate per-accident cap as there is in BI liability.

Exclusions and Coordination

Key Part B exclusions:

• Injury while occupying a vehicle with fewer than four wheels (e.g., a motorcycle).
• Injury while the vehicle is used as a public or livery conveyance (taxi, rideshare for hire).
• Injury occurring during business use of a vehicle furnished for the insured's regular use that is not the covered auto.
• Injury sustained while occupying a vehicle being used in racing.

Trap: Med Pay is excess over - and may be reduced by - Personal Injury Protection (PIP) in no-fault states, and benefits may be subject to subrogation/reimbursement if the injured person later collects from the at-fault party. Do not confuse Med Pay (covers the insured and passengers, no fault) with Part A liability (covers the other party when the insured is at fault).

What Expenses Qualify

Part B reads broadly: it covers expenses for medical, surgical, X-ray, dental, ambulance, hospital, professional nursing, and prosthetic devices, plus funeral services. The expense must be both reasonable in amount and necessary for the injury. The insurer may require the injured person to submit to a physical examination by a doctor it chooses and to authorize release of medical records as a condition of payment.

Because Med Pay pays quickly and without a liability determination, it is often the first coverage to respond after a crash, with Part A or the at-fault party's insurer reimbursing later through subrogation.

Med Pay vs. PIP vs. Bodily Injury Liability

Students confuse the three injury coverages constantly. Use this comparison:

Trap: PIP is broader than Med Pay because it adds lost wages and essential-services benefits; Med Pay is medical/funeral only. In add-on no-fault states the insured may carry both, with Med Pay coordinated as excess.

Other Insurance and Non-Duplication

The Other Insurance condition prevents the insured from collecting the same medical bill twice. If other auto medical payments coverage applies - for example, when the insured is injured as a passenger in someone else's covered auto - the policies share the loss. Coverage on a vehicle the insured does not own is generally excess over any other collectible auto insurance, while coverage on the insured's own vehicle is typically primary.

Med Pay also will not pay for an expense already paid under Part B of another policy issued to the same insured. Read "other insurance" facts carefully on the exam: the order of primary versus excess depends on whose vehicle the injured person was occupying.

Coordination With No-Fault and Liability Recovery

Medical payments sits between first-party and liability coverage. It is first-party (it pays the insured and occupants without proving fault) but, unlike PIP, it does not pay lost wages or replacement services — only reasonable and necessary medical and funeral expenses incurred within a time limit (commonly three years) from a covered accident. When the insured later recovers from an at-fault third party's bodily injury liability coverage for the same expenses, the non-duplication / subrogation provisions prevent a double recovery, and the med-pay insurer may seek reimbursement.

In no-fault states, statutory PIP can replace or supplement med pay, which is why the exam contrasts the three first-party/third-party mechanisms side by side.