6.3 Part B Medical Payments

Part B: Medical Payments Coverage

Part B (Medical Payments, or "Med Pay") pays reasonable and necessary medical and funeral expenses caused by an auto accident, regardless of fault. It is a first-party, no-fault style coverage written on a small per-person limit such as $1,000, $5,000, or $10,000 each person. Because it pays without litigation, it settles quickly and is popular in fault states that do not mandate Personal Injury Protection (PIP).

The expense must be incurred within three years of the accident. The covered services include medical, surgical, X-ray, dental, ambulance, hospital, professional nursing, prosthetic devices, and funeral services.

Who Is Covered Under Part B

Med Pay follows two categories of insured:

1. You and family members while occupying any auto (your own, a friend's, a rental) or when struck by a motor vehicle as a pedestrian.
2. Any other person while occupying your covered auto with permission.

This dual structure is a common exam point: the named insured and resident family members carry their Med Pay with them as pedestrians or as passengers in other people's cars, whereas guests are covered only while in the insured's own covered auto.

Limit Application and Coordination

The Part B limit applies per person, per accident, and is separate from the Part A liability limit and from Part C. The same medical bills cannot be paid twice, however — if the insured recovers the same expense under Part A, Part C, or PIP, the PAP coordinates to prevent duplicate payment. Med Pay is excess over a similar no-fault/PIP benefit in many states.

Key Part B Exclusions

• Injury sustained while occupying a vehicle with fewer than four wheels (motorcycles) unless specifically covered.
• Injury while the covered auto is used as a public or livery conveyance (ride-share for hire).
• Injury occurring during business use of a vehicle the insured does not own.
• Injury sustained while occupying a vehicle (other than a covered auto) furnished for regular use.
• Injury arising from war, nuclear hazard, or racing on a track.

Worked Example

A named insured carries $5,000 Med Pay. She is a passenger in a friend's car when it crashes; her medical bills total $7,200. Part B pays $5,000 (the per-person limit), and she carries her own Med Pay into the friend's vehicle because family/named insureds are covered while occupying any auto. The remaining $2,200 must come from another source (the friend's coverage, liability recovery, or her health plan).

Med Pay Versus PIP (No-Fault)

Exams in no-fault states contrast Part B Med Pay with Personal Injury Protection (PIP). Med Pay is a narrow benefit paying only medical and funeral expenses on a per-person limit, with no recovery for lost wages or essential services. PIP is broader: it typically pays medical expenses, a portion of lost wages, essential-services (replacement-services) costs, and a death/survivor benefit, and it is mandatory in true no-fault states.

In a no-fault state, PIP is primary and Med Pay either is not sold or sits excess above PIP. In a traditional tort/fault state, Med Pay is the main first-party medical option and is purely optional. Know which benefits each provides because matching questions frequently list lost wages and essential services as PIP-only features that Med Pay does not cover.

Subrogation and the "Each Person" Limit

When the insurer pays Med Pay and the insured later recovers from the at-fault party, the insurer has a right of reimbursement (subrogation) for amounts it paid, again to prevent a double recovery. The Part B limit is stated as an amount "for each person"; there is no separate per-accident aggregate, so two injured family members each draw on the full per-person limit. A frequent trap presents a single accident injuring three covered persons and asks for the total payout: with a $5,000 each-person limit, three fully injured persons could draw up to $15,000 in aggregate, because the limit is applied person by person.

What Counts as "Occupying"

The PAP defines "occupying" as in, upon, getting in, on, out of, or off a vehicle. This broad definition matters for Med Pay and UM/UIM eligibility: a person leaning into the trunk, stepping onto the running board, or in the act of exiting is still "occupying" and therefore covered as an occupant rather than treated as a pedestrian.

Examiners use borderline fact patterns — a passenger standing beside a stalled covered auto, or someone changing a tire — to test whether the person is occupying. A person no longer in physical contact with the vehicle and not in the act of entering or exiting is generally not occupying and, if a guest rather than a family member, would not be covered.

Med Pay in One Picture

Tie Part B together with a single rule set the exam rewards. Med Pay pays reasonable and necessary medical and funeral expenses from an auto accident regardless of fault, on a small per-person limit ($1,000 to $10,000 typical), for expenses incurred within three years of the accident. It follows two insured groups: the named insured and resident family members in any auto or as pedestrians struck by a vehicle, and guest occupants while in the insured's covered auto. Guests are not covered as pedestrians or in other cars; that broader portability belongs only to the named insured and family.

Because the limit is stated 'for each person' with no per-accident aggregate, a single crash injuring three covered persons lets each draw the full per-person limit — a frequent total-payout trap. When the insurer pays Med Pay and the insured later recovers from the at-fault driver, the insurer has a reimbursement (subrogation) right to prevent double recovery, and in many states Med Pay sits excess over a similar PIP/no-fault benefit so the two do not duplicate.