3/24/2015 11:00 AM

Do You Carry Sufficient Protection from Other Motorists?

While many drivers purchasing automobile insurance do so to stay legal, few realize the most important factor about their purchase is protection, not the price.  Your auto insurance policy is there to protect you.

Obviously, collision and other than collision are both coverages that protect your car.  You probably know your deductibles if you have these coverages.  However, these are not the most important protection your auto insurance policy offers.

Medical and Uninsured/underinsured motorist are coverages that exist just to protect you and those in your car.

Medical provides coverage for medical expenses for those injured in your car.  This coverage can prove to be really important for those without health insurance or with large deductibles.  A trip to the emergency room or the cost of an ambulance can be extremely high.

Medical coverage also can help protect you when you’re not at fault.  You can go through your own insurance company to pay your medical bills while you’re waiting to settle with the at fault company.

Uninsured and underinsured motorist coverage exists to protect you from other drivers on the road.  Specifically, uninsured motorist protects you from drivers on the road who have no car insurance.  Underinsured motorist protects against those who carry too little insurance, or less insurance than the cost of the damage.

The odds of being hit by a driver in one of those categories are rather high.  Around 1 in 7 drivers on the road is uninsured.  Many of the ones who are insured carry state minimum limits, which in Indiana are $25,000 per person, $50,000 per accident liability with $10,000 property damage.

It doesn’t sound too bad at first.  $25,000 can sound like a lot of money, until you compare it to hospital bill costs.  One client was commuting to work one day when she was rear-ended at a high speed, causing her to hit a concrete barrier.  She was badly injured, which led to high medical bills, including treatment, physical therapy, and even hospitalization.  

She also was not able to work during this time.  She lost over $100,000 in income from being unable to work, and her medical bills came in over $125,000.  The injury was not a quick or easy fix.  The accident had a terrible and significant impact on her life, and she will likely suffer for the rest of her life.

Unfortunately, the other driver only carried state minimum levels, providing only $25,000 to cover all the damage.  She was paid the full amount, but the driver had no other insurance and no assets to go after.  Even if she took him to court, he could never possibly pay to the amount of her losses.

Luckily, she carried $250,000 per person / $500,000 per accident uninsured/underinsured liability as well as a $1 Million umbrella policy.  She was able to go through her own insurance to recover the amount in losses she was entitled to from damage done by the driver who did not carry enough insurance.

Imagine a life changing injury and huge amounts lost in wages, and only receiving $25,000 to cover it all.  If she didn’t carry higher uninsured/underinsured liability levels and the umbrella policy, she would have been out of luck and unable to afford her own medical care.

If you currently carry state minimum liability, or low levels of liability on your auto insurance, consider increasing the amount.  Moving up to the next level of coverage for liability and uninsured/underinsured motorist is often not very expensive.  Give us a call, because it is likely very worth the little bit of extra money to have better protection for yourself and your assets.

If you already have the highest uninsured/underinsured liability limits offered by your insurance company, you could still choose to have higher protection.  An umbrella can go above and beyond both your home and auto.  An umbrella increases your limits of liability to the limit of the umbrella, which is most frequently 1 million.  You can also choose to increase your uninsured/underinsured motorist liability to 1 million as well.  

While it may cost more, I would really suggest you include it.  Think of it this way, if you purchase an umbrella to protect yourself from liability claims and your assets, wouldn’t you want to protect yourself and your family from possible injuries from others?

Take another look at your auto policy.  Make sure that the coverage you carry now will be enough for you to feel safe if you are the next victim of an uninsured or underinsured motorist.



 Photo: “Aftermath of Car Crash on Randolph at Michigan, January 21, 2015.” By Daniel X. O’Neil. Flikr. CC BY 2.0

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