How Much Car Insurance Do You Need?
On May 18, we wrote about new laws that have since taken effect (as of July 1), increasing the minimum amount of liability insurance that could be purchased for a covered automobile, and also increasing the jurisdictional limits of our state’s general district courts when hearing auto accident injury trials.
In that article, we also touched on one of the other coverages that can come with your auto policy, uninsured/underinsured motorist coverage. Uninsured motorist coverage protects you from the possibility that you get injured by another driver who had no insurance at all. Underinsured motorist coverage applies when the amount of compensation properly due you from an accident injury exceeds the other driver’s liability insurance limits.
So if you suffer a major injury and then discover that the offending driver had only $50,000 in liability coverage – or perhaps no coverage at all – your own auto policy can save the day for you, provided that you kept your UM/UIM coverage in place, and provided you bought the right amount of coverage for you.
We regularly see television ads for one of the nation’s largest insurers, letting you know that you can reduce your premium payments if you “only pay for what you need.” Those ads essentially invite you to buy only as much insurance as the law requires, which would include forgoing uninsured/underinsured motorist coverage in order to reduce your premiums. We strongly urge our clients never to do this. The supposed savings is not as much as you might think. More importantly, you don’t want to be the person who faces a serious injury (to yourself or a family member), and then finds that there simply isn’t enough insurance coverage available to provide full and fair compensation for your medical bills, lost income, and possible long-term or permanent injury.
You should never let the same person who hurts you physically dictate how much you will or won’t get in compensation. Bear in mind, some of the worst drivers around are the same sorts of irresponsible people who drive with little or no insurance themselves.
When you begin the process of buying your own insurance, your “UM/UIM” coverage will be set at the same level as your liability insurance. You can reduce or disclaim UM/UIM coverage — but again, we urge you not to.
To the contrary, you should strongly consider increasing your liability limits, not just to protect you from the possibility of your being liable for a momentary mistake on the road, but also to get the corresponding increase in UM/UIM coverages – for your own protection from the bad drivers out there.