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Uninsured/Underinsured Motorists Coverage: It's Vital

“Is everybody in?” Dianna smiles and tugs on each seat belt securing her two daughters, Sophie and Alex, in the back seat. She climbs into the passenger seat and secures her seat belt. Their car merges easily into traffic on highway 101. It’s 4:00 pm and traffic is just beginning to get heavy for Rush hour. Dianna turns to look at her girls. “How was school today? What did you learn today?” Tom interrupts, “Oh no, look at the traffic ahead – must be an accident!” Tom gently brakes to slow the car. Dianna turns forward in her seat- a sea of brake lights ahead. “Looks like we’ll be here a while. Who wants to play I Spy?” Alex, the younger of her two daughter’s answers ” I do…I spy with my little eye…” Dianna turns to look at her, and then as if in slow motion she sees the heads of both of her daughters whipped forward. Their car is hit forcefully by the car behind them. Dianna’s head slams into the passenger side window, shattering glass throughout the car. The car comes to a stop. For the first time Tom hears his daughters screaming and crying, he turns to find Dianna holding her head, blood oozing from through fingers. Tom tries to open the driver’s side door and realizes that he cannot move his left leg. All are taken to the hospital by ambulance.

The medical bills for the children, Tom and Dianna exceed $50,000.00; they will each suffer pain for years to come, Dianna and Tom will have lost earnings of more than $10,000.00. Both drivers were insured as required by the State of California.

To an inexperienced personal injury lawyer, this might sound like a great case. But what if negligent driver’s policy limit is only the minimum required by California law (15/30), $15,000.00 per person/$30,000.00 total? Most people who have the minimum insurance are unlikely to have other assets. The insurance company will offer $30,000.00 total and be done with the case. This tiny settlement won’t even cover the medical bills, much less loss of earnings or compensation for pain and suffering.

The attorney needed to ask his clients one more question: Does the driver of the car or any injured person have Uninsured/Underinsured Motorists Coverage (hereafter UIM Coverage)? If so, what are the limits?

Drivers may pay for UIM coverage as part of their automobile insurance coverage. The driver may choose the limits; the higher the limits the better.

In our imaginary case, if the injured driver or any injured passenger had UIM coverage of $100,000.00/$300,000.00 he or she would have a potential recovery of $15,000.00 from the negligent driver and $85,000.00 from the UIM policy. Two of the other injured passengers would have the same potential recovery. In most cases like this, the four injured persons would have to divide the $300,000.00 total recovery. However, the full value of plaintiff’s cases are far more than $100,000 each. If the UIM limits were $250,000.00/$500,000.00 a potential recovery of $500,000.00 total would have been available.

These days many drivers are driving without insurance or with woefully inadequate coverage amounts. Drivers should protect themselves and their passengers from disaster by having the highest UIM coverage they can afford. It is surprising that the rates for UIM coverage are very reasonable. The time to talk to your insurance carrier about UIM options is before you are involved in a major accident.