Auto accident can happen at any time and there is no way to predict how badly you might be injured. You could be out of work for weeks or even months following a serious auto accident and incur significant medical expenses – not to mention your pain and suffering. If the person who caused the accident has adequate insurance, these costs may be covered. However, you can’t be sure that the person who hits you will have enough insurance to cover your damages. Under-insured motorist coverage (or “UIM” coverage) protects you from drivers who either have no insurance, or not enough insurance or a “phantom” driver who flees the scene of the accident.
A typical scenario that I often see is when a client is hit by another driver and suffers significant injuries. In the case I am referring to, a young woman suddenly crossed the center line on a two-lane road and hit my client head on. My client required emergency surgery to repair several fractures, she will undergo follow-up surgeries as well as physical and occupational therapy. Her injuries may have permanent consequences. She will require home nursing care and will miss work for months. Finally, her non-economic damages like pain and suffering and loss of enjoyment of life are substantial. Ordinarily, this case would result in a personal injury settlement or jury award exceeding $250,000. However, the young woman who was at fault had only the minimum in liability insurance — $30,000.
My client’s health insurance policy requires her to reimburse any health care expenses they pay which are reimbursed by a third-party. In this case, most of the $30,000 my client recovers from the defendant’s auto insurance coverage will be paid to her health insurance company. Meanwhile, the 19-years-old Defendant and has no assets. Underinsured motorist coverage is intended to protect you in this situation.
Each auto insurance policy has underinsured motorist (“UIM”) coverage which is usually equal to your liability insurance limits. If you have the minimum in liability coverage ($30,000 in Md) then your UIM coverage will also be limited to just $30,000. If you have $300,000 in liability coverage, then your UIM coverage will also be $300,000. Your UIM coverage allows you to protect yourself to the same extent as you protect other drivers. In the case I discussed, my client had $100,000 in UIM coverage. Therefore, she will be able to collect $30,000 from the young woman who hit her and $70,000 from her own insurance company through her UIM coverage.
An additional benefit of UIM coverage is that making a claim should not cause her insurance premiums to increase. My client did not cause the accident, therefore, her claim for UIM coverage does not make her any greater risk as a driver. Her driving record remains unblemished because she was not at fault in causing this accident.
While my client in this case will likely recover a total of $100,000 which should cover her medical expenses (including her out-of-pocket costs), her lost income as well as her legal fees, it is unlikely she will recover compensation for her pain and suffering and other non-economic damages. If she had $300,000 in liability and UIM coverage, all of her damages would have been covered regardless of whether the person who hit her had adequate insurance.
For more information on how to protect yourself in auto accident cases, Contact Burch Law Firm, LLC for a free initial consultation with an experienced personal injury attorney.