THE IMPORTANCE OF UNINSURED / UNDERINSURED MOTORIST COVERAGE
In California, insurance companies are required to provide the option of uninsured/underinsured motorist coverage. While this coverage is not mandatory, it is certainly worth every penny of the small premium. With so many vehicles on the road that are not covered by insurance at all or have minimum policy limits coverage, it is extremely important to review your coverages and reasonably increase them to an amount that will actually protect your assets as well as you, your family and occupants of your vehicles.
The minimum requirements for liability policy limits in California is presently $15,000 per person/$30,000 per incident. That means that any one person injured by someone covered by a minimal policy could only recover up to $15,000 from the person’s insurer. However, if two or more people are injured in the same accident, they could only recover $30,000 from the insurer to be divided amongst them. Obviously, those limits do not cover much damages and are easily exhausted. Unfortunately, there are many people who are driving around with minimum liability coverage. Often, this is due to financial constraints. However, it is also caused by not understanding the importance of such having adequate coverage.
Uninsured motorist coverage provides potential benefits in the event that you are involved in an accident that is caused by a driver of a vehicle, whether a car, truck, bus or motorcycle, that was not covered by insurance, either his/her own or the vehicle’s owner. In that case, your uninsured motorist coverage is available to provide compensation for all damages and losses caused by the uninsured motorist up to your uninsured motorist policy limits. This is a claim that is pursued against your own insurance company and should not affect your rates. Such claims must often be pursued with the same vigor as a claim against the uninsured motorist would be. It is always advisable to have legal representation from the beginning.
Without uninsured motorist coverage, you could be left without any insurance or deep pockets to pursue other than from the uninsured motorist who caused the accident. However, someone without insurance probably does not have any significant assets. Therefore, it is essential that you protect yourself by having sufficient coverage for liability as well as uninsured motorist coverage.
In California, insurers must provide you with the option to have uninsured motorist coverage up to the same limits as your liability coverage unless it is one of the few companies who only provide uninsured motorist coverage up to $30,000 per person/$60,000 per incident, regardless of your liability limits. If you opt not to have uninsured motorist coverage at all or in an amount that is less than your liability limits, you must sign a document confirming that you have intentionally done so. Without such documentation, the insurer will be required to provide you with at least the state mandated minimum uninsured motorist coverage of $30,000 per person/$60,000 per incident unless your liability policy limits are $15,000/$30,000, in which event they must provide uninsured/underinsured motorist coverage in that amount.
Underinsured motorist coverage provides you with potential insurance benefits in the event that you are injured by a party who does not have a substantial liability insurance policy. For example, if the person who caused your accident has a $15,000 per person liability policy and your claim is worth $100,000, you are generally limited to recovering $15,000 from that person’s insurance policy. Aside from that, you have the option of proceeding against that person’s personal assets or income. Alternatively, if you have uninsured/underinsured motorist coverage that is in excess of $15,000 per person, you could settle with that person for the $15,000 policy limit and then proceed against your own insurance company for additional underinsured motorist benefits, potentially collecting the difference between the $15,000 and the policy limits. If you are in such a situation and have uninsured/underinsured motorist coverage of $100,000, you can settle with the other person for the $15,000 policy limit and collect an additional $85,000 from your own insurance policy. The same would apply for any passengers in your vehicle at the time of the accident.
Uninsured/underinsured motorist coverage may also provide coverage to you and other members of your household if you are a pedestrian and in some instances if you are a bicyclist who is hit by an uninsured/underinsured motorist. Unfortunately, this is an often overlooked benefit that should be seriously considered when you are purchasing automobile insurance, renewing or updating your policy. You should be certain to review your policy and discuss the cost of obtaining uninsured/underinsured motorist and increasing your limits in general.
Again, remember that you can generally increase your uninsured/underinsured motorist coverage to the same limits as your liability coverage. This nominal expense can provide substantial benefits in the future.
At the Meissner Law Firm, we can provide information and insight on the benefits of having appropriate coverage based on our years of experience and handling all kinds of cases involving vehicular accidents.