The law in California is that every owner of a vehicle is  required to have $15/30k in "liability" insurance so if the driver causes injury or damage, his or  her  insurance company will pay up to $15,000 per person up to a maximum of $30,000). No other form of insurance is required.

 

Last week (see HOW MUCH IS ENOUGH AUTO INSURANCE?) I explained why it was my recommendation that $2 million dollars is the appropriate amount of insurance to  get through the use of primary and  umbrella coverage. This week, I will be advising you on what "extra" insurance is worth buying.

 

The  answer is to tell your insurance agent that  you also want MED PAY and UNINSURED/UNDERINSURED MOTORIST coverage. Also COLLISION coverage if you want your car repaired.

 

Med Pay is short for Medical Payments Coverage. Usually your auto insurance carrier will add this onto your policy for a very nominal  additional charge. Most companies offer $2,000 or $5,000 in medical payments coverage. Most will also offer $10,000 or even $25,000 (which is  what I have).  This coverage means that no matter who causes the accident, your medical bills and those  of your passengers (remember 40 million Americans (of a  total of 300 million) do not have health insurance) will be covered by your auto insurance carrier. Some people say they don't need it because they have health insurance and while  there is  some truth to this, everyone knows that with standard health insurance, you have to pay your co-pays (which you can get reimbursed for under your Med Pay coverage) and you can only go to  certain approved doctors. With Med Pay, you can go to any doctor you want (even chiropractors, acupuncturists and in some cases, massage therapists). Many Kaiser members are unhappy with the type of treatment that Kaiser  offers especially physical therapy (which sometimes is along the lines of "Here are two exercise bands;  go home and do the exercises we showed you for 6 weeks") and they use their Med Pay to go to a facility like what  Jerry Rice or Joe Montana would go to (with hot  and cold pack therapy, electro-stimulation, ultra-sound, massage therapy, supervised use of strengthening machines, passive  motion therapy/stretching and all around  top-of-the-line treatment). Be  aware however that some auto  carriers  classify their Med Pay as "secondary" which means that you must first submit your bills to  your health insurance carrier if you have one and if they don't pay, then you can try to get it paid under your Med Pay. Carriers who classify their Med Pay as "secondary" are a huge pain in the neck to  get to  pay your bills. As a result,  many people just  give up and pay the bills  themselves. So I recommend that you shop around and try to buy insurance from a carrier that does not classify their Med Pay as "secondary".