Medical Expense Limit
The maximum amount a commercial general liability policy will pay for immediate medical costs incurred by a third party injured on the insured's premises or due to the insured's operations, without requiring a liability determination.
The medical expense limit, also called medical payments or med pay, covers immediate medical costs for injured third parties regardless of fault. This no-fault coverage pays quickly for minor injuries, helping prevent small incidents from escalating into larger liability claims. Standard CGL policies typically include $5,000 or $10,000 per person.
In COI compliance, the medical expense limit is a relatively minor coverage element but still appears on ACORD 25 certificates. While most contractual insurance requirements focus on occurrence and aggregate limits, some detailed specifications include minimum medical expense amounts.
Compliance teams should verify medical expense limits when contracts specify them but should prioritize occurrence and aggregate limit verification. The medical expense limit's value in COI compliance is primarily as an indicator that the underlying CGL policy is properly structured with all standard coverage components intact.
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