Medical on car insurance?

[Corporate ORphan]

I remember last year my State Farm insurance agent tried to put a medical rider for my DH and I on our car insurance policy. I told her to take it off because I had very good COBRA insurance at the time. Well, now we have a HD HSA policy with a $11,000 deductible.

I'm thinking that the State Farm rider might be a good idea. Anyone have any experience with them?

Thanks!

 

[JakeBrake]

I remember last year my State Farm insurance agent tried to put a medical rider for my DH and I on our car insurance policy. I told her to take it off because I had very good COBRA insurance at the time. Well, now we have a HD HSA policy with a $11,000 deductible.

I'm thinking that the State Farm rider might be a good idea. Anyone have any experience with them?

Thanks!

Back in 2004 DW and I were in a serious auto accident. I was laid up for 3 months. We had State Farm Insurance with medical coverage. As soon as it became apparent that we were going to have significant medical bills, State Farm sent checks for the full amount of our medical coverage directly to the hospital. This was $5,000 each for DW and me. Unfortunately, this was only a drop in the bucket compared to our medical bills.

The other driver was determined to be at fault. His insurance company (Progressive)
assumed responsibilility up to the limit of their liability. This guy had the legally required minimum liability insurance so he was off the hook legally. I guess he did not want to take any chances in civil court so he declared bankruptcy a couple of weeks after the wreck. He was not seriously injured, but his vehicle was totalled as was ours.

So, our Uninsured Motorist coverage with State Farm paid for most of our medical bills. With State Farm your Uninsured Motorist coverage "stacks". In other words we had 3 vehicles insured by State Farm with the same amount of coverage on each vehicle. So, our total coverage available for the wreck equalled to 3 times the coverage per vehicle.

 

[SteveL]

Med payments can be a good choice in your circumstances. The basic rule is you can't collect twice. With your large ded. on your health insurance, 5-10k$ in med pay coverage would fill out the ded.....

 

[scrabbler1]

Besides Medical Payments coverage (if your state does not require No-Fault which usually has a pretty high medical limit), you should also be mindful of buying a decent amount of Underinsured Motorists coverage. UIM applies when the at-fault driver is at fault, has some liability insurance, but not enough to cover your damages. I think this is what JakeBrake was referring to. In many states, UIM is sold in tandem with UM and might be referred to UM, however.

 

[dgoldenz]

I have $10k medical on my car insurance with SF and I think that covers anyone you might injure too. Even if you have great health insurance coverage, what if your passenger has a $10k deductible? I'm not a property and casualty agent, but I'd rather pay the extra few bucks and not worry about it. I think it costs me around $15/year. Your agent should be able to clarify.

 

[East Texas]

Medical payments on your car provides coverage on a per person basis for you and any passengers in your vehicle at the time of the accident. It is also a no fault coverage, which means it doesn't matter who caused the accident.

Your uninsured / underinsured motorist coverage (UM/UIM) kicks in when the other person was at fault and did not have (or did not have enough of) bodily injury coverage. MedPay and UM/UIM are stackable.

I am fortunate my insurance company (USAA) allows me to carry $100k MedPay and $100k personal injury protection (PIP). That coverage is not available for all insurance companies or in all states - you'll have to check with your carrier. The good part of it is we only pay about $7 every six months for that limit of MedPay coverage and $16 every six months for PIP because of our good rating.

As Steve said, you can't collect on both your car insurance and your medical insurance. You can be made whole, just not "better".

Liability is the cheapest part of your insurance policy if you have a good driving record, good claims record, clean credit report (I know...), and usually have some kind of tenure with the company along with multiple policies.

I'm restraining myself from getting on my tangent about "minimum liability limits" on car policies.

 

[East Texas]

A clarification on the point about not collecting on both health and car insurance. The two companies can partner and get all the bills paid. NOW - if you get a settlement that is at least the total of the medical bills that have been paid by your health and/or auto insurance companies, you must reimburse both health and auto to make them whole and you get to keep the rest.

The reason again is you cannot be in a better position after the accident than you were prior to it.

If health and auto paid $50,000 in bills and you got $50,000 settlement, you are essentially $100,000 to the good - you have had no out of pocket expenses and you have a settlement. The purpose of insurance is to make you whole, not improve, which is why you have to reimburse the $50,000 the two companies paid and you wind up with zero. Had the settlement been for $70,000, you would have been able to keep the $20,000.

 

[scrabbler1]

Your uninsured / underinsured motorist coverage (UM/UIM) kicks in when the other person was at fault and did not have (or did not have enough of) bodily injury coverage. MedPay and UM/UIM are stackable.

Med Pay and UM/UIM are stackable only if your state's law allows it. In my 23 years working in the auto insurance industry (actuarial), UM/UIM were stackable in maybe 1/3 of the states. Med Pay was stackable in maybe 1 state (at least this was true when I ERed in 2008; states don't change these laws very often). In states which allow UM/UIM stacking, the rates for multi-car policies, especially at higher limits, are higher than in states which don't allow stacking. If you have a single-car policy, you don't get to benefit from stacking, of course.

 

[East Texas]

Thank you for the correction to my post about stacking coverages.

Are single car policies even issued any more?

 

[scrabbler1]

Thank you for the correction to my post about stacking coverages.

Are single car policies even issued any more?

Plenty of policies have only one car on them. I have had one for many years, as have most of my friends. In rural areas, maybe 25% of policies are single-car. In urban areas, it can be close to 50%.

 

[East Texas]

Plenty of policies have only one car on them. I have had one for many years, as have most of my friends. In rural areas, maybe 25% of policies are single-car. In urban areas, it can be close to 50%.

A single car policy means something else to me. Back when I first worked in insurance we used to issue them for things like motorcycles, RVs, etc that didn't fit the definition of an automobile.

 

[samclem]

Why would you add medical coverage to your car insurance? There are hundreds of ways you could wind up needing medical care (you have a stroke, heart attack, cancer, skiing accident, etc), and being in a car crash is just one of them. You apparently are willing to partially self-insure (through your HD medical insurance) for a portion of every other kind of medical issue you might have--what makes a car accident different?

This is like paying more for double-indemnity on life insurance (does DW need twice as much money because I died in an accident vs dieing of an aneurism?)

The insurance company makes money on all these riders. If you have some reason to believe that you're at significantly higher risk of needing medical care as a result of a car accident than their actuaries believe you are, then buy the policy. Or, if spending this money makes you feel better. But I don't think it makes sense financially.

 

[East Texas]

Insurance is all about risk. If I were to place the odds of being in a car accident versus a heart attack, the car accident is more probable. The piece of mind of paying a couple of dollars a month for $100,000 worth of MedPay coverage is priceless. It's one of those situations where I'd rather have the coverage and not need it than need it and not have it.

The other side of the coin is having passengers in my car who may not have health insurance or have high deductibles. If I'm at fault, I want to be able to take care of their medical bills without hassle. If the other party is at fault and their insurance company drags about paying, my insurance company will cover the bills for my passenger(s) and then go after the other company.

Insurance may not make sense to you financially. It would be irresponsible of me not to carry homeowner, auto, health, long term care, etc. and all the coverages within those policies that protect me financially. I'm not willing to self-insure because I am not willing to take a gamble with our financial future.

 

[Darryl]

I use a HDHP almost never buy extended warranties run 1k deductible on car ins. etc. etc. and I pay for med ins. on my auto. Megacorp (preHDHP) would send warning memo's annually about the need for us to carry, as they stated health ins would not cover car accidents. Urban legends? I believe they were/are locked in mortal combat over who will pay with some of my peers.
Just not worth the aggravation for such a common event that can have a huge bill attached and has other gotcha's as previous posters noted.