Pennsylvania requires that all drivers demonstrate financial responsibility by carrying a minimum amount of auto liability insurance. Specifically, drivers must carry at least the following:
- $15,000 per person/$30,000 per accident in bodily injury liability
- $5,000 in property damage liability
- $5,000 in medical payments
This coverage pays for another driver’s injuries or property damage if the policyholder is liable. Unfortunately, these minimum coverages are often insufficient to cover the full extent of victims’ damages – and many drivers only purchase the minimum coverage. A serious back or neck injury, for instance, may result in more than $100,000 in medical bills. If the liable driver only carries the minimum coverage, $15,000 will be but a drop in the bucket for the victim.
It is situations such as this where carrying extra coverages such as uninsured motorist coverage (UM) and underinsured motorist coverage (UIM) can prove beneficial. Below, we review the fundamentals of both types of coverage and when they might be beneficial.
The Basics of Underinsured Motorist Coverage
Pennsylvania’s car accident liability laws are quite complex. It’s one of the few states that subscribe to a “choice no-fault” system, in which injured victims either can recover damages by filing a claim with their own insurer or by filing a claim with the at-fault party’s insurer. You are only entitled to opt to file a claim against the other party when your injuries are serious, permanent or disfiguring.
When you file a claim for a serious injury with the other party’s insurer, you will only be entitled to a settlement for up to their policy’s limit. If that driver only carries the $15,000 minimum bodily injury liability coverage, then $15,000 is the most you’ll get from that insurer, even if your damages totaled, say, $100,000. If you require surgery, hospitalization, rehabilitation, nursing services or future medical treatment, those expenses can escalate quickly.
UIM, an optional coverage in Pennsylvania, is for these kinds of situations. It covers your losses if another party was at fault for the accident and doesn’t have enough coverage to compensate your losses. If you carry UIM, you will be able to file a claim with your own insurance company to recover the remainder of your damages (up to your policy limits). This coverage can be a godsend and help you pay for medical bills and other damages while you recover from the accident. Without it, you might be left to pay for a lot of damages out of pocket when the other driver’s policy is inadequate.
The Basics of Uninsured Motorist Coverage
The law requires that all drivers carry liability insurance – but that doesn’t mean all drivers abide by the law. Drivers may let their auto insurance policy lapse, neglect their payments for financial reasons or drive illegally and simply not have coverage. In fact, according to the Insurance Research Council, about 7 percent of Pennsylvania drivers may be uninsured. Regardless of the reasons for failing to carry insurance, what do you do if another driver causes your accident and she or he doesn’t have auto insurance at all?
You turn to your own policy and use your UM coverage. UM covers your and your passengers’ injuries when another driver was at fault, and it covers you in hit-and-run accidents. Similar to UIM, without this coverage, you’ll have to pay for your damages out-of-pocket if the driver doesn’t have auto insurance or flees the scene.
So, is UM/UIM coverage worth carrying? In our professional legal opinion, the answer is an unequivocal yes. Plus, adding UM/UIM to your policy will increase your monthly premiums only by several dollars a month; it’d be silly not to carry the coverage.
Naturally, it’s a good idea to get as much insurance as you can reasonably afford. The higher the limits, the greater the protection in the event of an accident with an uninsured, underinsured, or hit-and-run driver. The minimum amount of UM/UIM you can purchase is $15,000/$30,000, but you might consider purchasing higher limits. Your budget, your financial capability to handle accidents and the amount of peace of mind you want are all factors that determine the amount of coverage you should purchase.
The best thing to do is to speak with your insurance agent about your needs and create a policy that works best for you. You may want to visit the Pennsylvania Insurance Department site first and download a free copy of their Automobile Insurance Guide, which provides a lot of helpful information when selecting coverages.
Your agent can recommend the right amount of coverage based on the value of your vehicle and other aforementioned factors and may discuss other optional coverages available in Pennsylvania, such as funeral benefit coverage, collision and comprehensive coverage, and stacking UM/UIM coverages. It also wouldn’t hurt to call around and get several quotes to ensure you get a reasonable deal.
Ensuring You Get Full Recovery of Damages
If ever you’re involved in an accident, you will want to pursue a full and fair recovery for your damages. The best way to accomplish this is to ensure you have adequate insurance coverage before disaster strikes and to speak to an injury attorney prior to signing any settlement offers.
Insurers are trained to minimize claims, and they may offer you a settlement that’s far lower that what you’re actually entitled to. An attorney will be able to review the facts of the accident, evaluate the full value of your claim and advise you of the best way to move forward to maximize your recovery.
You might want to download a free copy of our ebook, Don’t Crash Again! A Car Accident Victim’s Guide to Maximizing Recovery. Authored by personal injury attorney Michael Saile, this guide will answer a lot of important questions people often have after an accident regarding everything from paying for medical bills and missed time from work to finding an attorney and settling a lawsuit.
If you’re ever involved in an accident, Cordisco & Saile is here to help. Contact us at 215-791-8272 or fill out our online contact form to schedule a free consultation with a car accident attorney in Pennsylvania.