Driving with inadequate automobile insurance is extremely risky. In California for example, a state with an estimated 20.2 million drivers, approximately 5.1 million of these people do not have automobile insurance. That's right - a whopping 25% of all California drivers are uninsured.
What does this mean for those of us that are insured?
Take a good look at your current auto insurance coverage!
When it comes to automobile insurance, are you adequately covered? One of the biggest risks of driving is the possibility of getting injured in an accident. Besides the physical damage to your automobile, the potential damage to your body may be permanent. This risk can be severely compounded in the event you are involved in an accident with an uninsured or even an underinsured motorist. Did you know that in most circumstances where an insured driver is injured by an uninsured or underinsured motorist, the maximum damage recovery available to the insured driver will be the amount of his or her own underinsured or underinsured automobile insurance coverage? As unfair as this may seem, it is true.
Under California Law, all drivers must be "Financially Responsible" for damages resulting from ownership or operation of a motor vehicle and must be able to prove this if involved in an accident. The easiest way to meet this requirement is to purchase automobile insurance. The minimum limit required in California is:
* Bodily Injury (BI): $15,000 for each person injured or killed in an accident / $30,000 for injury or death to two or more persons in one accident.
* Property Damage (PD): $5,000
These limits are typically stated as 15/30/5 and, while they are the least expensive, they are far below amounts necessary for adequate protection.
Take for example a case that we recently had in our office: A married locomotive engineer was killed by a negligent uninsured motorist. At the time of the accident, our client's deceased husband was earning $70,000 per year and had a 15/30/5 automobile insurance policy. The person who caused the accident, has no insurance, assets or money for which to pay a judgment. Therefore, the amount of recovery for the surviving spouse is limited to her husband's uninsured motorist policy of $15,000. While this is an absolute tragedy, it could have been avoided.
Automobile insurance companies offer a variety of plans and coverage to consumers. Sifting through the choices can be confusing, but keep in mind insurance is there to protect you. While The Crow Law Offices is not an insurance agent and does not benefit from premiums paid to insurance companies, we do recommend that you contact your insurance provider and examine the types of options available. Automobile insurance is one of the most important matters of family protection that you can consider.
When talking with your agent, make sure you inquire about Uninsured Motorist (UM) coverage. It is one of the most important options available. UM is typically purchased as part of your existing insurance package and is available in different amounts of coverage. The policy is usually stated in terms of two numbers such as 15/30. The first number represents the amount available for one person and the second represents the amount available for the accident. These two numbers are extremely important as they represent the maximum amount you can recover in the event of an accident caused by an uninsured motorist. We recommend that motorists obtain policies with a minimum 250/500 amount of coverage.
There are two types of UM coverage available; Uninsured Motorist Bodily Injury (UMBI) and Uninsured Motorist Property Damage (UMPD).
UMBI coverage pays for injuries to you and persons in your car in the event of an accident caused by an uninsured motorist. This type of coverage is typically offered with liability insurance and can only be refused by written waiver.
UMPD coverage pays for damage to your vehicle when caused by an uninsured motorist.
Adequate Uninsured Motorist protection is one of the most important types of coverage that we recommend. In most cases the added expense of additional coverage is surprisingly quite small. Had the individual in the above example increased his coverage to say 250/500, his surviving spouse could have been entitled to receive as much as $250,000 in damage recovery. Additional types of coverage to consider are:
Underinsured Motorist (UIM): Covers damages when the other party has some insurance but not enough to cover the total amount of your damages. UIM coverage is typically part of your UMBI coverage and has limits equal to your UMBI coverage without a further premium.
Liability Insurance: This is your protection in the event that you are at fault in an accident. It compensates others and protects your personal assets from claims.
Fortunately, the large number of uninsured motorists in California has not gone unnoticed by state government. Steps were taken in 1996 to reduce the number of uninsured motorists on the road. It started in September when California Governor Pete Wilson signed "Proof of Insurance" legislation and ended in November with the passage of Proposition 213, "The Uninsured Motorist Law" by an overwhelming 76.9% of the voters. While both measures were aimed at punishing those that drive without insurance, they are distinctly different laws.
The September legislation outlined the legal aspect of not having insurance. Under this law, motorists are now required to show proof of insurance in order to renew their vehicle registration. It also allows police to ask motorists for proof of insurance at the time of a traffic violation. Those that fail to show such proof face a $1,000 fine, suspended driver's license or possible impounding of their cars.
California proposition 213, also known as "The Personal Responsibility Act of 1996" outlined the types of damage recovery uninsured motorists are limited to if involved in an accident. The measure was focused in three areas:
* Denial of recovery of damages to a convicted felon whose injuries were caused in the commission of a felony or immediate flight therein.
* Denial of recovery for non-economic losses to compensate for pain, suffering, inconvenience, physical impairment, disfigurement or other non-pecuniary damages to uninsured motorists injured while operating a motor vehicle or drunk drivers, if subsequently convicted.
* Provides that the insurer is not liable for economic damages when an uninsured motorist is injured by a subsequently convicted drunk driver.
The Crow Law Offices believes that insurance affordability will continue to dictate the number of uninsured motorists on the road. Therefore, we recommend that you contact your insurance agent to examine your options as soon as possible. The need for proper insurance coverage is crucial no matter where you live.
Published by The Crow Law Offices.
Copyright © 2010, all rights reserved.
No part of this article may be copied, photocopied or duplicated in any form without prior written consent of The Crow Law Offices. The information in this article is based on sources we believe to be reliable but there is no guarantee that it is complete or accurate. Opinions expressed in this article are those of the authors at the date of the article and are subject to change.
This report is not meant to be legal advice. It is recommended that questions of a legal nature be directed to an attorney in the firm.