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Car & Motorcycle Accidents
Uninsured and Underinsured Motorist Car Insurance: It Can Be Your Most Important Car Insurance and Here Is Why (Part 2 in the Series)
My recent article posted on Virginia Beach Injuryboard blog network discussed the confusing topic of uninsured motorists on the interstates, and whether they cause a major percentage of car accidents, or a larger than expected share of car accidents compared to insured drivers. This article in the series touches on this related subject: what happens if you are in a car accident and the other driver turns out to have minimum or inadequate car insurance (UIM situations)? Especially if the at fault driver’s insurance clearly will not be able to provide enough car insurance to cover your injury losses such as medical expenses, lost wages and the things such as permanent scars, permanent impairment etc. Unfortunately, under some state laws you will not find out the amount of the at fault driver's car insurance until months after you have suffered an injury. Check out our free, in-depth consumer report on uninsured/underinsured drivers and take a look these articles for additional information.
Related Articles on this topic:
First, let me define the situations when underinsured car driver insurance (called UIM as explained below) applies.
Hit and run drivers: if the driver hit your car and injures you but never stops at the scene, and the license plate number cannot be located for example, Virginia and nearly all states allow you to make a claim through the uninsured motorist coverage of your policy. See my prior article relating to uninsured motorist coverage, listed above.
Minimum at fault driver insurance coverage situations: these are the situations where underinsured driver/motorist coverage comes into play, which adjusters and injury lawyers refer to as UIM coverage (underinsured motorist). Virginia only requires $25,000 of liability car insurance, some states only require $15,000 of liability insurance coverage. If the other driver causes serious injuries to you or a family member and only has a $25,000 liability policy, you are considered an underinsured motorists/car driver. You will obtain the right to additional coverage for your injuries under your own uninsured motorist coverages in most scenarios. States differ on how underinsured motorist coverage can be applied when the other driver does not have adequate coverage for the magnitude of you or a family member's personal injuries. In Virginia, the analysis of how much underinsured motorist coverage may apply is an offset against the available minimum insurance of the other driver (if your uninsured/underinsured motorist coverage on your own car policy exceeds the minimum coverage of the other driver, you are entitled to the difference, called the offset, of how much more underinsured motorist coverage you have access to). In many other states, you are entitled to all of the uninsured motorist coverage under policies that you have coverage under, in addition to the available minimum insurance coverage of the other driver that is at fault.
The way that car insurance provides coverage in a car accident with an uninsured/underinsured driver car accident is very misunderstood by the public. In Virginia (VA), North Carolina (NC) and many other states, a typical car insurance policy provides that if you are in a car accident and suffer personal injuries caused by any driver with no car insurance, or inadequate insurance, that your own car insurance will provide coverage to protect you. This works in a strange way: your car insurance company provides a legal defense to uninsured/underinsured driver, and must pay up to the total uninsured/underinsured motorist insurance coverage the policy provides (this depends on the severity of the injuries and the damages and the analysis varies by state on how underinsured car insurance coverage applies). So, underinsured driver/motorist coverage (“UIM”) takes care of the situation where the at-fault driver has some insurance, but not enough to adequately compensate the injured party. Under either scenario, the policy pays for any aspect of bodily injury damages that the injured party could recover from the at-fault driver, such as medical expenses, lost wages/earnings, pain and suffering, recoverable in any personal injury or wrongful death suit. UIM coverage provides protection not only if you are in your own car, but also if you are in someone else’s car. Uninsured/underinsured driver coverage also extends to the policyholder’s family members and covers other vehicle/car-related accidents, such as hit and runs, or pedestrians or bike/cyclists who are struck and injured by a car.
Looking at statistics can help you make a decision about purchasing uninsured / underinsured motorist coverage. On average, there are around 6 million car accidents each year in the United States. It is difficult to know the exact number of motorists on the road with insufficient insurance (as they are only discovered if they are in an accident), but studies estimate that approximately 14% of all drivers have inadequate insurance, or no insurance at all.
Let’s use a real scenario that a recent client faced when she was a back seat passenger in her friend's car that was hit nearly head-on by a drunk driver in Northern Virginia in 2008. My passenger client had a $50,000 uninsured motorist coverage under her own car insurance policy (which applies even though she was not in her car) and we learned that her friend who was the driver of the car she was in, also had a $50,000 uninsured motorist coverage. The drunk driver had only $25,000 liability coverage, likely because she had already had a prior DUI/DWI conviction.
In Virginia, and in most states, any uninsured motorist coverages on the host car (car the injured victim is riding in) may be combined with any other uninsured motorist policy coverage that a person has on their own car or cars. Therefore, in this situation involving the drunk driver in Northern Virginia, my client was able to access $100,000 in underinsured driver/motorist coverage (UIM). Fortunately, my client did not have a $25,000 minimum uninsured motorist coverage, and she was simply fortunate that her friend who was driving and was not at fault also had a $50,000 uninsured motorist coverage. These coverages are combined or stacked under Virginia, and many states laws.
Scenario To Explain How Client Gets Underinsured Motorist Coverage
When Injured As A Passenger In Friend’s Car
Passenger-$50,000 UM coverage
(client’s own car UM policy)
Driver Friend-$50,000 UM coverage
(driver’s own car UM policy)
Drunk Driver/At Fault Driver: $25,000 insurance only
Computing Total Available Insurance Coverage to Client Passenger: At least $100,000 (* Both UM polices combined/stacked under most state laws) ( 25,000 available from drunk driver’s liability insurance, combined with the offsetting $75,000 “underinsured” motorist coverage from the driver’s friend and driver’s underinsured coverage-in Virginia there is an “offset” analysis, but note many other states simply add the available underinsured coverage to the available liability coverage—this varies state by state.
What Steps You Should Take Now
Is $100,000 in UM/UIM coverage enough on your own policy? Remember that this is the coverage that's going to apply to you or your family member-if you have the financial means to do so, we recommend not less than $250,000 UM coverage and in many states it means that you must increase your bodily injury liability limit to equal to or higher than $2500,000 as well, as most insurers will not allow the UM/UIM uninsured motorist limit to exceed the amount of the liability limits on your car policy. If you have the financial means to do so, are further recommendation is actually to have at least $500,000 of liability and uninsured motorist coverage.
Again, there is no way to visually know whether the driver in the car next to you on the interstate highway has appropriate insurance, or to forecast a car accident. Also, the way all car insurance works is that the coverage you have in place on the day you were injured is the coverage that you have a by law. You cannot seek to increase your coverage after you are in a terrible car accident as that increased coverage will not apply to the injuries sustained before you changed your coverage. The bottom line is that you need to get out your car insurance policy and study your coverage. Our law firm has had numerous clients explaining that they have "full coverage" on their car insurance policy, and when we get it we find that there is only $25,000 of liability and uninsured driver coverage. "Full coverage" usually just means that your policy has liability, property damage, and uninsured motorist protection but this still could be totally inadequate if it is at $25,000, for example.
About the Editors: Shapiro, Cooper Lewis & Appleton is a law firm which focuses exclusively on injury and accident law. We have a proven track record in the court room, and you can review our case results to see for yourself. Our attorneys have deep roots in Virginia and handle cases throughout the commonwealth. Our office is based in Virginia Beach, but we're ready to come to you anywhere in Virginia if you've been seriously hurt by someone else's carelessness.
Rick Shapiro and James Lewis were included among the "Best Lawyers in America" 2010 Edition, named Virginia "Super Lawyers" For Personal Injury Law (2009 Ed., less than 5% of lawyers are chosen), and selected by the National Million Dollar Advocates Forum (2009). In addition, we were the first injury law firm in Virginia to join Primerus, a select group of highly ethical, respected law firms. Our firm has the highest rating of AV from Martindale-Hubbell, a national lawyer ranking organization, which means we have a reputation for preeminent legal skill.
We provide FREE injury case consultations, so call us toll free at 1-800-752-0042. We also offer FREE special reports along with editing the Virginia Beach Injuryboard and Norfolk Injuryboard as a public information service. Our injury attorneys also host an extensive injury law video library on Youtube and a Railroad Accident/FELA Lawyers Blog.
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Car & Motorcycle Accidents
- I've been hurt in a car wreck and the insurance company for the other driver has called me to give a recorded statement. Should I do it?
- Should I use my regular health insurance to pay for the medical care I need as a result of a car accident?
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