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If you live in a “no-fault” state, you are required to buy either personal injury protection (PIP) or medical payments (MedPay) coverage in order to drive. PIP and MedPay cover your medical bills and those of your passengers after a car accident, regardless of who’s at fault. Twelve states and Puerto Rico fall into the “no-fault” category (see list).

The 12 no-fault states are:

New Jersey
New York
North Dakota

Having both MedPay and health insurance can be confusing for the policyholder.

If you have MedPay as part of your car insurance, filing a claim requires several steps.

Generally, you pay for your treatment but your insurance company will reimburse you. If you use MedPay to cover medical expenses, tell the doctor or hospital your auto insurance will pay for the treatment.

Some insurance companies let the policyholder decide which coverage (MedPay or health insurance) to use. But your health care provider may want you to use MedPay first if you were injured in an auto accident. MedPay and PIP are designed for immediate and short-term care and generally used first. Once their limits are exhausted, your health insurance kicks in.

If you live in a state without no-fault insurance, and have MedPay or PIP on your auto policy, always use it first to pay for medical expenses related to car accidents. Your health insurer may deny coverage until you have exhausted MedPay or PIP benefits.

Living in a “no-fault” state?

If you live in a “no-fault” state, there’s little reason to buy both MedPay and PIP: That’s because PIP provides coverage equal to and beyond MedPay (although PIP often has a deductible and MedPay has none).

MedPay generally covers reasonable and necessary expenses for medical, surgical, dental and chiropractic treatment. It also covers hospitalization, ambulance services, X-rays, nursing services, prosthetic devices and funeral services.

PIP, on the other hand, covers the same services as MedPay. But PIP also covers psychiatric, physical, occupational therapy and rehabilitation, plus any other professional health services (check your policy for exact details). In addition, PIP covers lost wages, reasonable costs other than medical and work-loss expenses and a small death benefit.

In many situations, having both MedPay and PIP is duplicate coverage. But there are certain situations in which MedPay can be valuable. MedPay can help offset the deductible that comes with PIP or health insurance. Also, PIP coverage in some states will not pay for medical expenses if you are injured while driving intoxicated.

If you have health insurance or belong to an HMO, you probably don’t need MedPay.

Also, MedPay is no substitute for broader health insurance. Few companies are willing to sell more than $25,000 worth of MedPay coverage. According to McCollum & Griggs, a Missouri-based personal injury law firm, common MedPay limits are $1,000, $2,000, $5,000, $10,000 and $25,000.

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Penny Gusner


Penny is an expert on insurance procedures, rates, policies and claims. She has extensive knowledge of all major insurance lines -- auto, homeowners, life and health insurance. She has been answering consumers’ questions as an analyst for more than 15 years and has been featured in numerous major media outlets, including the Washington Post and Kiplinger’s.