Why Should I Review My Automobile Insurance Coverage With My Lawyer?
My first employment, even while I was in law school, was working for a major national automobile insurance carrier. Because of this, I’m fairly well versed in the different types of coverages that are available, and more importantly, how they impact your life if you, a family member, or occupants in your vehicle are involved in an automobile accident.
In New York, there are certain coverages that are mandatory. The primary coverage is liability insurance, which protects you against claims made by other people against you. These can come from occupants in another vehicle, pedestrians, or even occupants in your own vehicle in the event of an accident. The minimum coverage in New York State for any passenger vehicle, as opposed to a commercial vehicle, is $25,000/$50,000.
The other mandatory coverages include basic no-fault coverage, which pays for medical bills and lost wage payments. This coverage usually has a limit of $50,000, which is a combination of both of those types of reimbursements. The last mandatory provision in a New York insurance policy is Supplemental Uninsured Motorist and Uninsured Motorist coverage usually referred to as SUM/UM coverage. This is a provision in your policy that protects you and the occupants of your vehicle in two different scenarios.
The first scenario is if you are involved in an automobile accident where the driver of the vehicle that caused the accident was not insured. How does that happen? Well, they may have had insurance at the time they registered their vehicle and may have stopped paying premiums, or it may have lapsed or been canceled for some other reason. Whatever the reason, when we later investigate the insurance coverage of the person who caused the accident, we may be told that the policy was canceled. Of course, we investigate this further to make sure that the proper steps were taken by the insurance company to cancel the coverage. However, if after exhausting all possibilities, there is no insurance coverage on the other vehicle, and that can be proven through New York State Department of Motor Vehicle records as well as from the insurance carrier’s records, then you or your passengers could make a SUM/UM claim under your own insurance policy. This coverage on your own policy will substitute for the other driver’s lack of insurance.
The second type of coverage under this portion of the policy is for under-insured vehicles. If the vehicle that caused an accident and causes your injury has an insufficient amount of insurance coverage to fairly compensate you for your injury or the injuries to your passengers, then you can make a claim under this provision of the policy for additional compensation.
The reason that you should review these coverages with me or someone from my team is that your insurance broker doesn’t necessarily have your best interests at heart when it comes to increasing some of these coverages. Some of them can be increased for a nominal amount of money, and the benefit to you, your loved ones, and the passengers in your vehicle is well worth the difference in premium dollars that you pay. Here is a case study to illustrate my point:
A client was involved in an accident as a passenger in someone else’s vehicle. The accident was caused by another driver who ran a red light and struck the SUV that our client was a passenger in. The vehicle flipped over and our client sustained significant injuries. Unfortunately, the vehicle that caused the accident was carrying the state minimum coverage of $25,000. So, although the injuries were significant, the most we could collect from the insurance carrier was $25,000.
Most people then say, “Well, why don’t you start a lawsuit?” Well, of course, we did start a lawsuit, but the old saying “You can’t get blood from a stone,” pertains to this situation.
When a person is carrying only $25,000 in insurance, many times they don’t have any other assets, and the only thing to be gained by proceeding with a lawsuit against them is to take a judgment that will be good for 10 or 20 years. Then, the hope is that sometime in the future they will have assets sufficient to exercise the judgment against.
Instead, we filed a claim with the insurance carrier for the vehicle that our client was a passenger in, as well as the client’s own personal vehicle that he was not in at the time of the accident. As a result of our strategy, another $75,000 was collected because the vehicle he was a passenger in had $100,000 worth of underinsured coverage, added together with the $25,000 collected, totaling $100,000. By contrast, his own vehicle only had $25,000 worth of this coverage. It was a shock to him and his family that he had higher limits to protect against claims from others but insufficient coverage for his own protection.
This type of coverage on your policy is suited for this purpose in particular – you can get more insurance for this line item than the bare minimum coverage.
This case was the subject of a letter that my client and I sent to the Governor of New York. Our goal was to help to convince him to sign the bill that was proposed by the New York State Trial Lawyers Association, (an organization I am a member of) that had passed both houses of the legislature. As a result of the trial lawyers and clients like mine, a new statute became effective as of June 2018 because of situations like the case study above. Our efforts have resulted in this coverage being automatically included in your policy in an amount equal to the amount of the liability limits that you carry.
Motorists can opt out of this coverage, but I strongly suggest that you do not.
Whether it’s you, a family member, or occupants of your vehicle, this coverage is crucial and comes into play more often than you would think. I have extensive experience in handling cases that involve various types of coverages in automobile insurance policies, as well as automobile accidents, and I’m happy to apply my experience to the facts of your case. Please call me if you’ve been involved in an accident. I can assist you through the entire process; from the initial paperwork all the way through trial.
Prior to the enactment of this legislation, you could have insurance coverage for liability of $250,000/$500,000 to protect you against claims from other people, however, your mandatory SUM/UM coverage could have been the minimum of $25,000/$50,000.
If you were involved in an accident with someone who had insurance of $25,000, you effectively couldn’t make a claim under this part of your policy for the difference because the insurance company is entitled to an offset for any money you collect. Therefore, you would have a line item that said you had a type of coverage that might help you, but in reality, you couldn’t ever use the coverage under the scenario I just described. Whereas, if you carry $250,000/$500,000 worth of liability coverage, you will automatically have the same mirror image coverage for you and occupants in your car for uninsured and underinsured motorist claims.
To set up a consultation where we can review your coverage, contact me.
Leonick Law, P.L.L.C.
TEL: (631) 486-9500