What You Don’t Know About Your Car Insurance Can Hurt You
When I recently wrote Zooming to a Conclusion, I focused primarily on the role technology played in resolving that case.
There was another angle that was equally important in allowing me to maximize the amount of funds my seriously injured client received.
Underinsured Motorist Coverage
As you may remember, that case involved my client and her sister as passengers in their friend’s car, which was struck by another vehicle.
Long story short, the other car (which was at fault) had very limited insurance, and my client had serious injuries requiring several surgeries. (My other client, her sister, had relatively minor injuries, so the driver’s insurance was adequate to compensate her.) The at-fault driver had the Illinois state minimum of insurance coverage, $25,000 per person / $50,000 per event.
Think about that for a moment. You are a passenger in your friend’s car that gets hit by someone else. Your friend is not really at fault. Your medical damages exceed $100,000. And all you can recover is $25,000 at most.
That seems terribly unfair.
If only there was something you could do about it.
UIM to the Rescue
Uninsured Motorist Coverage (UIM) was her salvation.
Remember the friend who was driving? Her policy was $100,000. Does this mean there was another $100,000 available? Not exactly. What this means is that my client could collect up to another $75,000. That’s the full liability limits of the friend’s UIM policy of $100,000, less the $25,000 from the at-fault party’s policy.
UIM coverage is triggered when you recover the entire policy limits, or nearly the entire policy limits, from the at-fault insurer. Often, the UIM carrier is your own carrier (although that was not the situation in this case), but it is still an adversarial process. Remember, insurers only make money when they pay out less in claims than they make in policy premiums.
So, my client just collected $25,000 from the at-fault driver and another $75,000 from her friend’s insurance. Sounds easy, right?
Not so fast!
UIM is Still Contested
UIM coverage is offered by insurance companies, whose sole existence is premised upon making money and paying as little on claims as possible. Just because coverage is available does not mean the money is easily paid out.
They make you work for it. While this case did not involve my client’s own company, every UIM proceeding is nearly the same as any other claim or lawsuit. It is you against the insurance company from which you are trying to get money. The process is adversarial. That’s yet another reason you always want legal representation.
In a perfect world, one could simply explain that, hey, my client has over $100,000 in damages, please send me the $25,000 policy coverage and the $75,000 from the UIM policy.
Instead, as I explained in the blog post, I had to present my clients for their depositions via Zoom. Then, we had to negotiate with both opposing attorneys. While we received the $25,000 from the at-fault insurer shortly after the depositions, we had to do quite a bit of haggling to squeeze out the UIM money.
Ultimately, we settled for just short of the UIM $75,000 maximum, giving my client a very nice settlement and plenty in her pocket even after all her medical bills were paid at a reduced rate.
The Lesson is Simple
If Covid-19 has taught us anything, it is that we cannot rely on anyone else or assume that someone else will take care of us. The only way we can be sure of something is if we do it ourselves.
My client was fortunate that her friend, the driver, had a policy larger than the at-fault driver’s, thus triggering the friend’s UIM coverage.
But you can’t just assume that your friends will have great insurance.
So What Should You Do?
If you own or lease a vehicle, and you expect to ride in another person’s vehicle or be a pedestrian or bicycle rider, you absolutely, positively must make sure your auto insurance policy has limits as high as you can afford. You also should make certain that you have not declined Uninsured Motorist (UM) or Underinsured Motorist (UIM) coverage.
Declining UM and UIM must be done in writing. In my opinion, it should never be declined. Your UIM limits will automatically be the same as your liability limits, unless you specifically request different limits. Also never do that.
The best way to protect yourself is to make sure your insurance limits are high. That way, if you do get hit by someone with minimal (or no) insurance, you are covered. You may also wish to talk to your insurance broker about a personal umbrella policy, which may contain additional coverage for UM and UIM.
Contact Chicago Personal Injury Lawyer Stephen Hoffman
As in all cases involving injury and potential liability, if you have been hit by a vehicle immediately get medical treatment, report the crash to police and your own insurance company, and contact a lawyer with expertise in your type of case, such as truck crashes, bicycle accidents or pedestrians hit by cars.
If you've been in an accident and have questions, contact Chicago personal injury attorney Stephen L. Hoffman for a free consultation at (773) 944-9737. Stephen has nearly 30 years of legal experience and has collected millions of dollars for his clients. He is listed as a SuperLawyer, has a 10.0 rating on Avvo, and is BBB A+ accredited. He is also an Executive Level Member of the Lincoln Square Ravenswood Chamber of Commerce.
Stephen handles personal injury claims on a contingency fee basis, which means you don’t pay anything upfront and he only gets paid if you do. Don’t wait another day, contact Stephen now.