Final answer:
True, Good health insurance does not necessarily mean you should avoid medical payments coverage on your car insurance, as it may provide benefits like covering deductibles and reducing underinsurance risk.
Step-by-step explanation:
The question of whether good health insurance negates the need for medical payments coverage on an automobile policy is not straightforwardly true or false. While health insurance does cover medical expenses, medical payments coverage in your automobile policy can provide additional benefits. This includes covering deductibles and copayments that your health insurance might require, potentially offering protection against underinsurance, where your out-of-pocket expenses or deductibles exceed a certain percentage of your income.
People may also consume less in medical care if they know they have to pay something out of pocket, which reduces the level of moral hazard. However, actuarially fair insurance premiums for those in high-risk groups, such as young male drivers, may lead to very high rates, which can dissuade high-risk individuals from obtaining insurance at all.