6.3 Part B Medical Payments

The Medical Payments Insuring Agreement

Part B – Medical Payments Coverage pays reasonable and necessary medical and funeral expenses incurred by an insured because of bodily injury caused by an auto accident. The two defining features for the exam: Part B is first-party coverage (it pays the insured and passengers, not third parties) and it pays regardless of fault (no-fault in the practical sense — you do not have to prove anyone was negligent).

Expenses must be incurred within 3 years (36 months) from the date of the accident. Covered expenses include medical, surgical, X-ray, dental, prosthetic, ambulance, hospital, professional nursing, and funeral services. The Med Pay limit is a per-person limit that applies separately to each insured injured in an accident — common amounts are $1,000, $2,000, $5,000, or $10,000 per person.

Who Is an Insured Under Part B

Part B defines "insured" in two categories, and the distinction is a frequent exam trap:

So the named insured and resident family members are covered as occupants of any auto and even as pedestrians hit by a car. But a guest passenger or other person is covered only while occupying your covered auto — not as a pedestrian, and not in another vehicle. "Occupying" means in, upon, getting in, on, out of, or off the vehicle.

Trap: If the named insured is a pedestrian struck by a car, Part B responds. If a guest passenger later steps out of the insured's car and is struck while standing on the sidewalk, Part B does NOT respond to that guest — only occupants who are 'any other person' are covered, and only while occupying your covered auto.

Coordination, Limits, and Worked Example

Med Pay applies on a per-person, per-accident basis. Because each injured insured has the full limit available, a single accident can pay multiples of the stated limit.

Worked example. A PAP has $5,000 Med Pay. The named insured is driving with two passengers (one a resident family member, one a guest). All three are hurt: named insured $4,200, family member $6,500, guest passenger $3,000.

The insurer pays $12,200 because the limit is per person, not per accident. The family member's $1,500 excess is uncovered by Med Pay (it may shift to Part C or health insurance).

Part B Exclusions and Anti-Duplication

Key Part B exclusions remove coverage for bodily injury sustained:

• While occupying a vehicle with fewer than four wheels (motorcycle).
• While the vehicle is used as a public or livery conveyance (excludes share-the-expense car pools).
• While occupying a vehicle (other than your covered auto) furnished or available for the regular use of you or a family member.
• During the course of employment if workers compensation benefits are required or available.
• While the insured is using a vehicle without a reasonable belief of entitlement to use it.
• While occupying a vehicle located for use as a residence or premises (a parked motor home used as a dwelling).

Med Pay also coordinates with other PAP coverages: the policy will not pay twice for the same element of loss covered under both Med Pay and another part such as Part C uninsured motorists. Med Pay is typically the first to respond because it pays promptly and without proving fault, and the insurer may have subrogation rights against an at-fault party to the extent it has paid.

Part B vs. PIP and No-Fault Coordination

Part B Medical Payments is a small first-party, no-fault medical coverage that pays reasonable medical and funeral expenses for the insured and passengers injured in a covered auto accident, regardless of fault, generally within three years of the accident.

In no-fault / PIP states (including Pennsylvania), statutory Personal Injury Protection (PIP) may replace or supplement Part B, covering medical, and sometimes wage loss and replacement services, without regard to fault. Where PIP applies, Med Pay coordinates with or is replaced by PIP per state law.

Trap: Med Pay covers the insured and occupants of the covered auto; it does not pay the other driver's injuries — those are third-party Part A liability claims.

Part B Exclusions and Coordination With Health Coverage

Part B Medical Payments contains exclusions that prevent overlap and control non-auto exposures. Common exclusions: injury sustained while occupying a vehicle with fewer than four wheels (most motorcycles), using a vehicle as a public/livery conveyance, injuries during the course of employment when workers compensation applies, occupying a vehicle used in the auto business, and injury while occupying a vehicle furnished for regular use that is not the covered auto.

Because Part B is no-fault and first-party, it often coordinates with the injured person's health insurance and, in no-fault states, with PIP. Med Pay can fill health-plan deductibles and copays and pays passengers who may have no health coverage of their own.

Exam tip: Part B covers the named insured and family members injured as pedestrians or occupants of any auto, plus other occupants of the covered auto — but it excludes motorcycle occupancy and on-the-job injuries covered by workers compensation.