New Rules Help Those Injured in Car Accidents

By law, Virginia drivers have long been required either to buy car insurance, or pay an uninsured motorist fee. (The main purpose of the fee has always been to incentivize you to just buy the insurance.) In order to prevent people from buying a policy that covers next to nothing, the state has always had a model policy document included in the law as well. Every insurer selling any policies in Virginia must offer at least the coverage required, and in the event its policy language falls short, it will be bound to the more expansive coverage required by law.

As part of that, the lowest amounts of coverage available for purchase have also been set by law. No policy issued in Virginia can provide bodily injury coverage limits less than $25,000 per injured person and $50,000 per incident – what’s known as “minimum limits” or “25/50” coverage.

The law has no provision to keep pace with inflation, and the legislature has not increased the minimum limits in decades.  That is, until now. Effective July 1, no policy can be issued in Virginia unless it has at least “50/100” coverage, that is, the legal policy minimums have been doubled.

Drivers will not see a premium increase immediately, however. The new limits do not take effect automatically on July 1.  Instead, the new limits govern what your insurer can offer you when your policy next renews. For some time, then, many drivers will still have only 25/50 coverage, until their anniversary dates roll around. It will take a year for the new limits to go into effect for every driver.

Because limits for uninsured/underinsured motorist coverage track liability figures, those limits will increase as well.

What this means is that, in cases where someone suffers between $25,000 and $50,000 of harm from an accident, they will most likely not have to worry about having only $25,000 of insurance money there to compensate them. Instead of having to consider whether a driver who bought the cheapest coverage available does or does not have any additional wherewithal from which to recover, or to face the prospect of being under-compensated, those with claims up to $50,000 in value should be relieved to discover that cash settlements are available where merited.

There are still limits to the assurance, however. Where more than two persons are injured in the same accident, the “per incident” limits can still limit the amount any one person might recover. And some drivers still either pay the uninsured motorist fee, or simply flout the law and drive illegally. While uninsured/underinsured coverages can be disclaimed in order to save money, you should never do that, lest you fall victim to one of those types of drivers. If you’re tempted to “only pay for what you need,” as one insurer’s commercials enticingly recommend, you should assume that you need UM/UIM.

Another change in the law will also help expedite resolution of personal injury claims that seek between $25,000 and $50,000.  While they don’t offer jury trials, our general district courts can provide swift and even generous outcomes for injured claimants without the burdens of pretrial discovery or long waits for trial dates. Typically, a general district court is empowered to award compensation in any case up to $25,000, but the General Assembly has now adopted an exception for personal injury claims, allowing a general district court to award an injured plaintiff whose case is filed after July 1 up to $50,000 when the evidence merits it.

Taken together, these new laws mean that many injured persons will benefit twice – first by getting more of, or all of what they deserve in compensation, and second, by getting their cases resolved faster and with less stress and difficulty.