Hunter Nelson explains how medical payments work in liability insurance. A small payout like $5,000 covers a claimant's deductible or minor damages and encourages quick settlement before lawyers get involved, unlike the $1 million liability coverage used when litigation happens.
It's going to cover medical payments. Medical payments, it's a liability policy. Most of the time for liability, some, or I should say some of the time, a lot of it gets drug into demands for money, lawyers coming in. And so medical payments is that, hey, don't sue me. Here's $5,000 to cover your health insurance deductible, to fix the window, the simple, quick payout. That's why it's $5,000 instead of $1 million, because $1 million is typically lawsuit money. So it's quick, don't sue me, let's settle this thing before I get put out of business because you get a lawyer, right?
