Yes. Your insurance company has a right to be paid back for money it pays you under the Med Pay coverage in your policy. This right to reimbursement is called “subrogation.”
What is Subrogation?
Subrogation allows one party to make a payment that another party owes, and then later collect that money from the party who originally owed it. For example, if a person is in a car accident, her Med Pay insurance may pay for some initial treatments. Subrogation allows the insurance company to reclaim the money from the at-fault driver’s insurance money.
If you settle a personal injury claim or recover money in a personal injury lawsuit and Med Pay covered some bills, the appropriate amount of money will be deducted from your settlement/recovery to repay the insurance company.
Does PIP Have to Be Paid Back?
No. The insurance company’s subrogation rights are different for Med Pay coverage than for Personal Injury Protection coverage (PIP). You do NOT have to pay the insurance company back for PIP coverage.
How is Med Pay Different from PIP?
Med Pay, also known as medical payments coverage, is a type of optional insurance coverage that can help pay medical bills for injuries sustained in a car crash. Having Med Pay as part of your auto insurance coverage means that your own automobile insurance policy will cover your medical expenses whether you caused the accident or the accident was caused by the other driver. On the other hand, in Florida, anybody who has a license and has insurance has what’s called personal injury protection (PIP). It is part of Florida’s no-fault law and it pays for the first $10,000 of any medical treatment that you have if you are injured in a car accident. It also pays for some funeral benefits and can pay for lost wages as well.
Med Pay and PIP Insurance Example
To better explain how PIP coverage and Med Pay benefits work in Florida car accidents, here is an example car accident case. First of all, it’s important to know that PIP pays at 80% for medical bills. So, for example, if you have $15,000 worth of medical expenses, your PIP would pay $8,000. ($8,000 is 80% of the first $10,000 of your medical bills from the accident.) You would be responsible for the remaining 20% or $2,000. Now, if you add $5,000 of Med Pay coverage to your auto insurance policy, Med Pay would pay for that $2,000 and there would be another $3,000 available to cover additional bills. This is how Med Pay coverage can help make sure that your own insurance company covers the first $13,000 of that $15,000.
Med Pay Insurer Subrogation
Unlike PIP, if you recover money from the other driver, that $5,000 in Med Pay is subrogated. This means it’s owed back to your insurance company and would come out of your settlement. The benefit of having Med Pay coverage is that you can make sure your medical expenses get paid quickly early on in your case. It can also ensure that you don’t hesitate to get all the medical treatment you need, which can also help prove the damages in your case.
Medical Payment Coverage and Health Insurance
Especially if you don’t have health insurance, getting $10,000 worth of Med Pay coverage can ensure that you are able to get the healthcare you need and your accident related medical expenses are taken care of right away. It can also be beneficial to people who have health insurance, as their medical bills are still subject to a deductible. Med Pay coverage could help cover the health insurance deductible amount and ensure that you don’t have to pay out-of-pocket for any of your medical expenses.
Medical Coverage in Auto Insurance Policies
If you’re able to select Med Pay coverage in your auto insurance policy, it can be a great way to make sure that you have access to the medical care you need in the event of an accident. Depending on your situation and type of coverage, it could also help you cover some or all of your out-of-pocket expenses. Knowing how Med Pay and PIP work together is key to understanding how your auto insurance policy will cover your medical bills following an accident. It’s important to do your research and speak with an attorney who understands Florida law and how it applies to car accidents. An experienced attorney can help you make the most of your Med Pay coverage and maximize your recovery for any damages or losses incurred as a result of the accident.
Injured in a Car Wreck and Have More Questions?
If you’ve been seriously injured in a car wreck in Pensacola and have questions about how much Med Pay coverage you have, or whether your Med Pay insurer can try to recoup money from your settlement with the other driver’s insurance company, it’s important to talk to an experienced Pensacola car accident lawyer. An attorney from Stevenson Klotz Injury Lawyers can explain the subrogation process and protect your rights throughout the entire legal process. We’re ready to put our 54 years of combined experience to work for you. Contact us for a free consultation.