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What Are Uninsured Motorist And Underinsured Motorist Coverages?
Uninsured motorist (UM) coverage pays for damages caused by another driver who does not have any insurance. Underinsured motorist (UIM) coverage pays for damages caused by a driver whose insurance coverage is not enough to pay the full amount of your financial losses (“damages”).
As you will see, these are important coverages that can protect you from significant financial losses. It is, therefore, important to consider having this coverage even though California law does not require drivers to carry it.
Like most California drivers, you are probably concerned about the rising cost of auto insurance. State law requires all drivers to carry certain coverage, but in order to reduce the cost of auto insurance premiums, many drivers opt out of additional coverage beyond the minimum legal requirement.
This can be a big mistake. If you are hit by a driver who doesn’t have auto insurance or just carries the minimum legal coverage, you could be left to pay expensive medical bills and other costs, even though the accident wasn’t your fault. You and your family could be left with significant financial strain as a result of another driver’s negligence. Consider protecting yourself with UM and UIM coverage.
What Does UM/UIM Insurance Cover?
UM/UIM coverage is designed to help cover your accident-related losses regardless of the other driver’s insurance coverage. In fact, it can cover both your economic and non-economic losses after a severe car accident. Here are some of the specific damages you can recover through uninsured/underinsured motorist coverage:
- Medical expenses
- Property damage, including vehicle repair bills and damage to other property.
- The cost of a rental vehicle
- Lost income
- Physical and emotional pain and suffering
- Lost quality of life
- Mental and emotional distress
Were You Hit By An Uninsured Or Underinsured Motorist?
At Arash Law, we help victims pursue damages after serious car accidents.
It is essential to understand the many different types of coverage that are available on your auto insurance policy. This allows you to plan ahead and avoid disastrous financial consequences. A personal injury lawyer can help you understand coverage under the at-fault driver’s insurance policy. If that driver doesn’t have insurance or has insufficient coverage to pay for all of your bills, you may be able to file a claim under your own policy. Seeking legal advice from an attorney can help you explore available insurance options.
Call (888) 488-1391 to schedule your free initial consultation with an experienced California personal injury attorney. At Arash Law, our car accident lawyers are committed to advocating for personal injury victims.
How An Uninsured Motorist Claim Works:
- You are hit by a driver who does not carry liability insurance. That is a violation of state law, but some California drivers do choose to break that law.
- You obtain a police report documenting that the accident was the other driver’s fault and that he or she provided no proof of insurance to the law enforcement officer who responded to the scene.
- You open a claim with your own auto insurance company.
- Your insurance company verifies that the other driver does not have insurance.
- Your insurance company must then offer to settle your claim. The amount offered must include compensation for medical bills, lost wages, pain and suffering, property damage, and any other financial losses caused by the other driver’s negligence.
- If a mutually agreed settlement is reached and a signed release is obtained, your insurance company will issue the payment. An experienced personal injury attorney can handle the negotiations on your behalf.
- If your insurance company refuses to offer a fair settlement, you may have to file a lawsuit to encourage them to make a reasonable settlement offer.
- If your insurance company still does not make a fair settlement offer, you may have to take the case to trial and let a jury determine the fair value of your claim. Consider hiring an experienced trial attorney who can effectively present a personal injury claim to a jury and justify the compensation you are seeking.
How An Underinsured Motorist Claim Works:
- You are hit by a driver who has auto insurance.
- You file a personal injury claim with the other driver’s insurance company. They agree that their driver was at fault. This is known as “accepting liability.”
- Your medical bills, lost wages, and other financial losses are more than the driver’s policy limits. Currently, California requires minimum coverage of $15,000 per person and $30,000 per accident. This amount can go surprisingly quickly.
- The other driver’s insurance company pays you the policy limits. They are not legally obligated to pay you more.
- You file a UIM claim with your own insurance company.
- Your insurance company verifies that the accident was the other driver’s fault and that his or her auto insurance policy limits have been met and paid.
- Your insurance company then determines the value of your claim. They will make a settlement offer for the amount beyond the other driver’s policy limits. (For example, if your total claim was worth $25,000 and the other driver’s insurance paid you $15,000, your own insurance company would pay you $10,000.
- Again, you may have to negotiate with your insurance company to pursue fair compensation. Consider seeking representation from a personal injury attorney who will advocate for your interests.
- If your insurance company refuses to make a fair settlement offer, you might have to file a lawsuit and let a jury determine the fair value of your claim.
Why Is It Important To Have UM & UIM Coverage?
You might think that it isn’t fair to pay for UM or UIM coverage. After all, these coverages only apply if another driver is at fault for your accident. Should the person at fault have to pay for all your losses? The short answer is yes. The law imposes an obligation to compensate a car accident victim for all financial losses caused by negligent driving.
Unfortunately, without insurance coverage, it can be nearly impossible to pursue compensation from a negligent driver. The time and expense of trying to get a judgment against the driver and enforce it is almost never worth the hassle.
For this reason, most California auto accident victims are left with whatever insurance coverage the at-fault driver has.
Some drivers violate the law by carrying no insurance coverage at all. This is not fair, but it happens. Even drivers who carry the minimum legal insurance coverage may not have enough to pay for all of your losses. $15,000 does not go very far when your injuries are severe or will cause permanent damage. In fact, this amount can easily be used up in one day’s stay at the hospital. It is vital to protect yourself from these added costs that may not be covered by another driver’s insurance company. Here are some of the serious consequences that can happen without UM or UIM coverage:
Scenario 1: The Uninsured Motorist
You are struck by another driver from Orange County who does not carry auto insurance. This driver has broken the state law. He is issued tickets for both the traffic offense and his lack of insurance. Unfortunately, you do not have UM coverage, and there is absolutely no auto insurance available. Your health insurance covers a portion of some of your medical bills, but not all of them. You miss work as a result of the car accident in Irvine. Your missing paychecks stretch your family income, which is already burdened by your medical bills. Despite the fact that the other driver was at fault for the accident and broke the law by driving without insurance, you have no way to be compensated for either your medical bills or your lost wages.
Scenario 2: The Underinsured Motorist
You are struck by a driver in Bakersfield who carries the minimum legal insurance coverage. His insurance company agrees that he was at fault and pays the $15,000 policy limit. In the meantime, your severe injuries have required a lot of medical attention. You had surgery and spent a week in the hospital. You require several weeks of physical therapy. You miss months of work and eventually are only able to return part-time. This drastically reduces your family income. The other driver did follow the law regarding auto insurance, but $15,000 has barely put a dent in your medical bills (which now total hundreds of thousands of dollars). You don’t know when you might be able to return to work full-time. This jeopardizes your health insurance coverage, which was the only thing keeping your medical bills in check. Your family is now in a difficult situation with ongoing financial challenges.
The Facts About Uninsured & Underinsured Motorists
According to the Insurance Information Institute, approximately 12 to 16 percent of American drivers do not carry any auto insurance. Estimates have shown that a significant percentage of drivers are uninsured, with California historically ranking among the states with higher rates of uninsured motorists. This means that approximately 15 percent of all innocent California auto accident victims will have no auto insurance available to them without UM or UIM coverage.
It is also important to remember that there is an additional percentage of injury victims who won’t have enough insurance available to them. The Rocky Mountain Insurance Information Association reports that the average bodily claim in 2013 cost $15,443. This means that the average claim already costs more than California’s minimum coverage of $15,000. And of course, this is only the average. Personal injury claims involving death, paralysis, and other permanent disabilities can easily run into the millions of dollars. Even in cases involving serious injuries, the insurance company only has a legal obligation to pay policy limits.
Catastrophic injury lawyers often assess these situations to explore possible recovery options beyond insurance coverage and to help identify potentially liable parties when policy limits fall short. This can leave a disabled injury victim with only $15,000 to cover millions of dollars’ worth of medical expenses. Lost wages, decreased future income, pain & suffering, loss of enjoyment of life, and other damages will be left entirely uncompensated.
Will I Have To Pay More For Auto Insurance If I File A UM Or UIM Claim?
Auto insurance premiums are calculated by your risk rating. Causing an accident increases your risk rating, which is why your premiums can increase if a claim is filed against you. But UM and UIM claims can only be submitted if someone else caused the accident. For this reason, merely filing a UM or UIM claim does not automatically trigger increases in your premiums.
However, being involved in multiple car accidents (regardless of who was at fault) can increase your risk rating. This is an indirect way some insurance companies will justify an increase in premiums. This possibility should not discourage you from filing a UM or UIM claim. You are legally entitled to the benefits of coverage you have paid for.
Think of UM or UIM coverage as a type of health insurance. If you file lots of claims, your health insurance company might consider you to be unhealthy and increase your premiums. But this doesn’t stop you from seeing doctors and getting the medical attention you need. It is a better financial strategy to be proactive and address health problems before they get worse. This is the same with injuries after an auto accident. If you don’t get the right medical care as soon as possible, your injuries can get worse or last longer.
Worse still, unpaid medical bills and lost wages can result in a substantial financial burden for any family. Stay ahead of this problem by accessing all insurance coverage to which you may be entitled. The time you have to file a claim may be limited by the applicable statute of limitations. Consult a car accident injury attorney who has experience filing uninsured & underinsured motorist-related insurance claims in California.
Contact Arash Law To Schedule A Free Case Review With A California Personal Injury Attorney
Accidents caused by drivers with little or no insurance coverage can be physically, financially, and emotionally devastating. You can protect yourself from challenging financial situations with UM and UIM coverage. Whether you are filing a claim under your coverage or the at-fault driver’s coverage, a personal injury attorney can protect your rights to seek compensation. Call Arash Law at (888) 488-1391 or contact us online to schedule a free initial consultation.
Our experienced California personal injury lawyers can handle negotiations with insurance companies and will advocate for your claims on your behalf. They can help you navigate the legal process to pursue compensation for the losses you sustain as a result of a car crash. Our accident lawyers serve clients in Los Angeles, San Diego, Sacramento, San Jose, San Francisco, Riverside, and Woodland Hills. However, regardless of your location in California, our injury attorneys can come to you.
We offer free initial consultations with no obligation to sign with our UIM/UM accident injury firm. Call us at (888) 488-1391 or complete our “Do I Have A Case?” form.
