Personal Liability vs Medical Payments Coverage

Wait, they’re not the same thing? You’re not alone in this conundrum of thinking that liability coverage and medical payments coverage within home insurance policies are the same thing. It’s one of the most common mix-ups in the world of home insurance.

The two coverages are similar in some ways, but they’re more different than they are alike. Let’s start by getting some clarification of each coverage.

Liability coverage is a widely used type of coverage in many different insurance policies. It usually has a $100,000 or higher limit that protects policyholders from having to pay out of pocket for medical bills if someone is injured on their property and they’re found liable, repairs for any damage caused to someone else’s property, medical bills if their dog bites someone on or off their property, and any lawsuits that may arise from the aforementioned events.

Home insurance companies typically allow you to add up to $500,000 of liability coverage to your policy. But there may be scenarios when you need more coverage. If you’re a homeowner or landlord and you have a pool, you’ll likely want to enroll in more coverage. Pool injuries, including accidental drowning, can quickly become costly and top the $1 million mark.

Umbrella insurance can be purchased in those instances to give policyholders $1 million or more of liability coverage. Usually, umbrella policies can be added in increments of $500,000 or $1 million when you hit the initial $1 million policy limit.

There are times when renters may need more than $100,000 in coverage, too. If you have a pool or another attractive nuisance, such as playground equipment, on your property, you’d rather be safe and opt for $250,000 or $500,000 in coverage. In addition, whether you own or rent, dog owners should opt for more than the $100,000 in coverage in case their dog bites someone.

You may also add a liability rider to your policy to cover things such as defamation and slander. This rider is not typically included in home insurance policies and will raise your monthly premium.

Liability insurance is found in homeowners, renters, condo and landlord insurance policies since all those types of home insurances are similar and, in each living situation, you may have guests on your property.

Medical payments to others coverage, on the other hand, kicks in and picks up small medical bills when a minor injury occurs on your property. Medical payments coverage is reserved for cheaper hospital and doctor bills, such as X-rays, ambulance rides, physical therapy, medication, deductibles and various other small medical bills that usually remain after health insurance picks up its portion.

But with this coverage, it doesn’t matter if you’re liable for the injury or not. With limits that typically range from $1,000 to $5,000, medical payments to others coverage is often used in conjunction with a person’s health insurance. Any substantial medical bill introduced as a claim under Coverage F would likely be escalated to a liability claim.

Medical payments to others coverage can typically also be found in homeowners, renters, condo and landlord insurance policies. However, it may be rare to see this coverage in renters and landlord policies.

There are a few huge differences between liability coverage and medical payments to others coverage. For liability insurance to kick in, you must be found liable for causing the injury. With medical payments coverage, it doesn’t matter who’s at fault for the injury, it will still kick in and pick up the tab.

While medical payments to others usually covers you for $1,000 to $5,000 per claim, liability coverage typically covers you for $100,000 to $1 million or more per claim. That’s an extremely substantial difference that can make or break the personal finances of most people.

In addition to the huge gap between amounts of coverage, liability ensures you’re covered for major medical procedures, legal expenses and settlement fees should the injury result in a lawsuit. Medical payments coverage is designed to stop a small injury from becoming a prolonged injury or lawsuit and will not cover either expense.

A medical payments claim can only be filed during a third-party injury, while a liability claim can be filed for a third-party injury and property damage claim. For many of these reasons, liability coverage is included in a home insurance policy and some insurance companies offer the consumer a choice to add or forgo medical payments to others coverage.

Aside from the fact that both are included in the same home insurance policies, are used to pay for medical expenses, and don’t cover anyone on the policy or people residing in the home, there really aren’t too many similarities between medical payments to others vs personal liability. If you file a medical payments claim that exceeds your policy limits, it will be converted into a liability claim on the insurer’s behalf.

To get either coverage, you must first enroll in a home insurance policy that’s designed for your needs. For instance, people who own houses need a homeowners insurance policy, while people who condos need a condo insurance policy, people who own either but rent it out need a landlord insurance policy and people who don’t own property at all need a renters insurance policy.

Here at Clovered, we partner with some of the nation’s top home insurance companies, so we can provide you with a customized policy that meets your needs and your budget. Simply answer a few details about your home in our online quoting tool and we’ll do the rest. It only takes a few minutes, so what are you waiting for?