Medical Expenses Limit
What Is the Medical Expense Limit in Insurance?
The general liability medical expense limit is the maximum amount insurance will pay out for no-fault accidents in the policy term. It’s no-fault coverage designed to pay for third-party medical expenses, loss of income, funeral expenses, and similar expenses to a third party.
TL;DR:
- An injury happens → person seeks treatment → insurance policy can pay up to this limit
- Payment is capped at the medical expense limit
- Serious injuries or lawsuits are covered with general liability limits
In small business general liability policies, for example, it’s the most your policy will pay for reasonable, small, no-fault medical bills if someone gets hurt on your premises or because of your operations. In other words, they don’t have to sue you for this coverage to kick in.
Key Takeaway: It’s a small, fast-pay coverage for minor third-party injuries.
What Does the General Liability Medical Expenses Limit Cover?
The medical expense limit is designed to provide a small, no-fault coverage limit. It can pay reasonable medical bills for someone hurt around or because of your business, up to the limit. This helps ensure minor injuries are settled quickly and don’t turn into costly lawsuits.
So, why is the medical expense limit so much lower than the policy limit?
Because it’s designed for quick, low-dollar injuries, not big claims. The medical expense limit is a small pot of money the insurer uses to pay simple medical bills fast (e.g., an ER visit, X-ray, stitches, etc.), so an easy-to-resolve situation doesn’t turn into a lengthy legal battle.
Your main general liability limit is saved for the expensive stuff: claims where someone says you were negligent, hires an attorney, or has long-term treatment. Keeping medical expense (aka “med pay”) limits low helps keep premiums down, saving your policy limit for bigger claims if they happen.
Medical Expense vs. General Liability Coverage: What’s the Difference?
The biggest difference between medical expenses and general liability insurance is that medical expenses is a no-fault coverage. You don’t have to be legally liable for the injuries for this coverage to pay the injured person, unlike general liability.
Check out the other key differences between these coverages below.
Swipe →
| Medical Expense (Med Pay) | General Liability (Bodily Injury/Property Damage) | |
|---|---|---|
|
Fault Required? |
No — typically pays regardless of fault |
Yes — requires you to be legally liable |
|
Purpose |
Quickly resolve minor injuries and avoid small lawsuits |
Protect against bigger claims / lawsuits |
|
Typical Limit |
Low (often $5,000 per person) |
Much higher (policy’s per-occurrence / aggregate limits, e.g., $1,000,000 / $2,000,000) |
|
Who It’s For |
Injured third parties (customers, visitors) |
Third-party physical injuries or property damage |
|
Includes Your Injuries / Injuries to Employees? |
No |
No (workers comp is needed for employees’ work-related injuries) |
Key Takeaway: Medical expense is a small, no-fault limit to cover minor injuries. General liability is a significant coverage that responds when someone blames your business and sues you, and the claim could become expensive.
Can the Medical Expense Limit Pay for Employee Injuries?
No. Medical expense coverage is for injured third parties, not you or your employees. Employee work-related injuries usually go through workers compensation insurance.
Workers Compensation Insurance vs. Medical Expense Limit at a Glance
Swipe →
| Medical Expense Limit (in General Liability) | Workers Compensation | |
|---|---|---|
|
Who It Covers |
Injured third parties (customers, visitors) |
Employees injured or ill because of work |
|
Fault Required? |
Often no-fault |
No-fault |
|
Typical Limit |
Low ($5,000–$10,000 per person; varies) |
Set by state law / policy benefits |
|
What It’s For |
Quick payment to avoid small lawsuits |
Wage replacement, medical care, rehab, funeral costs, and other state-mandated benefits |
TL;DR: Medical expense pays small medical bills for non-employees who get hurt because of your business. Workers comp covers costs related to your employees’ work-related injuries (and has much broader benefits determined by your state).
Additional Resources
- See what workers compensation insurance covers
- Read our guide to general liability insurance coverage
Get tailored coverage by selecting your industry below.