You must obtain insurance coverage on your own vehicle that will pay in the event the At-Fault driver’s insurance is insufficient. What is that?
You must first know what particular insurance coverages cover.
Liability Insurance: This is the insurance you buy for coverage to pay other people who are injured due to your negligence. This coverage protects your assets in the event you cause a wreck. Liability insurance does not provide you any money if it was your fault.
Med-pay/Personal Injury Protection (PIP):This insurance coverage is not mandatory. The insurance company does not have to write this coverage. However, it is very good coverage in that it is like having health insurance on your auto policy. If you are injured, this coverage will pay for medical bills related to your injuries, no matter whose fault it was. Therefore, if it is your fault or the other driver’s fault, and you incur medical bills due to injuries received in the accident, your Med-Pay or PIP coverage will reimburse you for those expenses. This coverage allows for individuals who have no health insurance the ability to received medical care. This coverage pays as bills are being incurred and does not wait until the end of the case to pay. This is very good coverage that allows you to take care of your health and the health of your family members in the event of an accident.
Uninsured Motorist Coverage: This insurance coverage provides for payment of your medical bills, lost wages, pain and suffering and other legal damages if the negligence of someone else caused the wreck and that person has no automobile insurance. Having sufficient uninsured motorist coverage is essential in a time that 1 out of 7 drivers on the road nationwide is uninsured.
Underinsured Motorist Coverage: This insurance coverage provides money to pay for your medical bills, lost wages, pain and suffering and other legal damages when the At-Fault driver has insurance but his insurance is insufficient to pay all the damages. This coverage is essential in South Carolina since the minimum required amount of liability coverage is $25,000.00 per person.
You ask: Okay, I understand there are people driving on the road with no insurance or too little insurance, but tell me, how can the Derrick Law Firm determine what coverages I need and how much I need?
Personally I have and recommend that people have $1,000,000.00 in Liability coverage, $1,000,000.00 in Uninsured Motorist coverage and $1,000,000.00 in Under-Insured Motorist coverage.
Isn’t that excessive?
Not if you and your family are involved in a serious accident which requires substantial medical treatment and you or your wife become disabled for a substantial amount of time.
You ask: If I can barely afford $25,000.00 of coverage, how in the world can afford $1,000,000.00? Would that not be 40 times the amount that I am paying now?
NO! In fact, because the large amounts of Uninsured Motorist coverage and Underinsured Motorist coverage are so cheap, the state of South Carolina had to pass a law to make insurance companies offer the coverage to you and explain in writing how cheap it is. For years, the insurance companies would not make the offer in a clear manner to let you know how much coverage you can buy for just pennies a day. For years, the Appellate courts of South Carolina kept saying that the information being given to consumers by the insurance companies was insufficient.
Why wouldn’t the insurance company want to sell me more coverage?
Because it is so cheap, some insurance companies would rather make $400.00 on you per year for $25,000.00 of Uninsured and Underinsured coverage than $450.00 per year for $500,000.00 of Uninsured and Underinsured Motorist coverage.
If you are paying $400 per year for $25,000 in coverage, you’re getting only $62.50 dollars of coverage for each dollar you spend. If you are paying $450 per year for $500,000 in coverage, you’re getting $1,111.00 dollars of coverage for the same dollar you spend.
Do I need or should I have $1 million dollars worth of Liability, Uninsured and Underinsured Motorist coverage? Should that be my policy limits on each of my vehicles?
Not necessarily. Another great thing about Uninsured Motorist coverage and Underinsured Motorist coverage is that it may be stackable. Which means if you are in a vehicle you own and are injured, you can stack the coverages of each of you vehicles. Therefore, if you have three vehicles and all have $300,000.00 of Uninsured Motorist coverage and you are injured by an At-Fault driver with no insurance, you actually have $300,000.00 + $300,000 + $300,000.00 equals $900,000.00 of Uninsured Motorist coverage available to you. The same applies for Underinsured Motorist coverage.
Therefore, if you have two cars you can $500,000.00 per vehicle in Uninsured and Underinsured Motorist coverage, and as long as you are injured while you are in your car, you have $1million dollars worth of coverage. If you have four vehicles, you only need $250,000.00 coverage on each vehicle to have the same coverage.
I would also recommend the Med-Pay / Personal Injury Protection (PIP) coverage. If you are injured in an accident and you incur medical bills, you can submit your medical bills to your insurance company and receive reimbursement for those medical bills through your Med-Pay and Personal Injury Protection coverages. This is important because it allows you to get medical care you need. It is also important for those individuals who have health insurance to cover their medicals in that it usually doesn’t matter if your health insurance covers your medicals, the Med-Pay or PIP will reimburse you for the medical bills whether they are paid by health insurance or not. This is important for those people who are either temporarily or totally disabled for reimbursement for these medical expenses through this coverage provides money to live on until your case is either tried or reached a point that it is ready to settle. I would recommend somewhere between $5,000.00 and $10,000.00 in Med-Pay or Personal Injury Protection coverage.