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Personal Injury Frequently Asked Questions
Clarifying Auto Insurance Coverage
Purchasing auto insurance is confusing for many of us. It’s not clear what various type of coverage contained in a policy mean. Who can decide what types of coverage they really need? And if you can decide what types of coverage you need, who can tell you how much is enough?
Let’s look at some of the various types of coverages that are offered:
Liability / Bodily Injury:
This coverage protects you from liability if you are the cause of an accident and someone else sues you for damages. If someone sues you, the amount of coverage you have in this portion of your policy is the maximum amount your insurance will pay, if necessary. Once this maximum is reached, you must pay any additional amounts yourself.
Amounts of Required Coverage: California State Law requires all drivers carry liability insurance with a minimum coverage amount of $15,000/$30,000 (The first figure is the maximum amount your insurance will pay per person ($15,000), and $30,000 maximum per accident. Therefore, if you cause an accident that injures 4 people, the most your insurance will pay for any one person to that accident is $15,000, and the most it will pay combined to all 4 of those people is $30,000.)
A Coverage Example: Suppose there is a judgment against you for an accident and the amount of damages awarded to the suing party was $100,000. Your policy limits, however, is the minimum of $30,000. The insurance will pay its limit, and you would personally owe the remainder, in this case, $70,000.
With medical costs spiraling ever higher, many insurance brokers recommend that everyone carry limits of at least $100,000/$300,000.
UM / UIM Coverage:
UM stands for Uninsured Motorist's Coverage, and UIM stands for Underinsured Motorist's Coverage. This important coverage will reimburse you if you are injured by someone else who has no insurance or very low insurance limits.
As we are all aware, California has a very high percentage of uninsured drivers. Buying UM/UIM coverage can help protect you if you are involved in an accident with an uninsured or under-insured driver. YOU CAN’T ASSUME THAT THE PERSON WHO HITS YOU WILL HAVE ADEQUATE COVERAGE to pay your costs!
California State law only requires $15,000/$30,000 of coverage, and a large portion of the driving population does not carry any insurance.
Many people who are involved in an injury accident get stuck having to cover their own costs. For example, you are a responsible citizen who carries high liability limits for personal injury to others, such as $250,000/$500,000 of overage, but you opted for only $15,000/$30,000 UM/UIM coverage. If an uninsured driver crashes into you and you have $30,000 in injuries and $70,000 of lost wages, you would be entitled to $100,000 in damages. However, since the person who injured you had no insurance, you must collect from your own policy's UM /UIM coverage. With limits of only $15,000/$30,000, you will have to pay for the majority of your loss yourself!
Skimping on UM/UIM coverage is a false savings. Obtaining adequate UM/UIM overage can go a long way toward protecting yourself from the financial devastation of an accident with an uninsured or under-insured motorist. It is a simple step to take to make sure you are adequately protected. In the unfortunate event of an accident with an uninsured motorist, you will be glad you are able to tap your own UM/UIM coverage to compensate you for your damages.
If you are in fact involved in an accident and you need expert legal advice from an expert personal injury attorney please call the Offices of Michael P. Sousa at 858-453-6122. We are here to help.
