New Colorado Car Insurance Law in 2009 Requires Medical Payments Coverage

Colorado Car Insurance Mandates

While medical payments coverage is a new requirement, the other Colorado car insurance mandates - according to the Rocky Mountain Information Association -- stipulate that each driver must carry bodily injury liability coverage of at least $25,000 per person per accident, and also $50,000 per accident. This is the BI 25/50 spread you might see on your insurance card. Next, Colorado car insurance requires property damage liability of at least $15,000 per incident.

Optional, but exceedingly good to have, is uninsured or underinsured motorist coverage. Sure, you could waive the coverage (in writing!) but it is a good idea to buy it in the same increments as you would buy the BI coverage.

With All This Colorado Car Insurance Already In Effect, What Is Medical Payments Coverage About?

Bodily injury liability (BI) covers the driver who causes the accident, while property damage liability (PD) covers any property the driver damages during an accident. The optional uninsured or underinsured motorist coverage (UM/UIM) providers for medical and other expenses when a driver is involved in an accident caused by another who lacks insurance, or did not purchase sufficient amounts to undo the damage caused.

Medical payments coverage - abbreviated as Med Pay or MPC - is an additional coverage option of $5,000. Much like UM/UIM coverage, drivers who wish to not have MPC must opt out in writing. This insurance is slated to cover trauma care bills first, followed by other medical expenses. Payment of the bills is done regardless of any liability apportioning, and the insurance company will pay for you or others in your car, even if you were at fault for the accident.

Why Is Colorado Amending Its Car Insurance To Add Medical Payments Coverage To Its Car Insurance Requirements - Even Though it's Optional?

Channel 13 News reveals that the reason for the medical payments coverage is Colorado's change in car insurance legislation that effectively took the previous no-fault accident coverage state to a tort state that adjudicates payment of claims on a finding of personal negligence. Gone are the days when insurance companies paid Colorado accident bills; instead, it is now up to attorneys and ambulance chasers to determine fault, allocate fiscal responsibility, and drag out litigation - much like it is the case in California.

Bottom-Line Me: What's The Cost

Channel 13 suggests that per driver, the estimated insurance rate increase is $60 per year. State Senator John Morse conceived of this bill as a way to pay medical bills even as the cases snake their ways through the court system. Those not quite so enamored with the extra $60 a year expense suggest that perhaps the insurance lobby does not want to get stuck with medical bills while a case is in litigation, and this "insurance" helps to defray the costs.

Sources: http://www.rmiia.org/Auto/Steering_Through_Your_Auto_Policy/Auto_Insurance_Colorado_Requirements.htm; http://www.krdo.com/Global/story.asp?S=9446888; http://www.cde.state.co.us/artemis/reg1_4/reg42c762007internet.pdf