How Uninsured/Underinsured Insurance Could Help if Severely Injured in a Car Accident

By: Arthur W. Wentlandt

Let’s say you get into a car accident and either you or someone in your family gets seriously injured as a result of the negligence of a driver operating a car that is insured with minimal limits of motor vehicle liability coverage.

One risk of getting into an accident with someone insured with minimal limits is that you will have access to severely limited funds. To avoid this situation, you should purchase sufficient uninsured/underinsured motorist coverage on your own policy of motor vehicle insurance.

Uninsured/underinsured motorist coverage allows you to recover from your own insurance carrier an amount in excess of the negligent driver’s coverage provided that the value of the claim brought by you or someone else injured in your vehicle is greater than the coverage available to the negligent driver.

To trigger access to your uninsured/underinsured motorist coverage, you must first recover the entire amount of coverage available to the negligent driver through settlement or judgment.

Once this is done, you can pursue the remaining value of the claim up to the limits of your uninsured/underinsured motorist coverage. However, the amount of coverage available to you is reduced by the amount of the negligent driver’s coverage.

For example, if the negligent driver’s motor vehicle insurance policy provides only the state’s minimum liability coverage of $25,000 for each injured individual and a total of $50,000 for all individuals injured in any given accident, and your policy provides uninsured/underinsured motorist coverage of $50,000, the amount of your uninsured/underinsured coverage available to a single individual traveling in your vehicle is the difference between the two coverage limits, or $25,000.

If the two coverage limits are the same, they cancel each other out and there is no additional coverage available beyond the negligent driver’s coverage.

As a result, it is important to purchase enough uninsured/underinsured coverage to provide a meaningful source of recovery if the coverage is needed. A good rule of thumb for choosing a sufficient amount of uninsured/underinsured coverage may be an amount equal to the liability coverage provided to you under your own policy. Uninsured/underinsurance coverage is relatively inexpensive and can become a huge benefit under the right, or wrong, circumstances.

It is also important to remember that under the terms of the standard motor vehicle insurance policy available in New York, your insurance carrier is provided the protection of a very short notice requirement when it comes to uninsured/underinsured claims. So, if your uninsured/underinsured coverage is called into question, it is essential that your carrier be put on notice of a potential uninsured/underinsured claim as early as possible.

We suggest that any time a motor vehicle personal injury claim against another driver is contemplated by you or a family member, your own carrier should be put on notice of the potential for an uninsured/underinsured claim at the outset. The attorney with whom you consult on the potential claim can do this easily by letter to your carrier.


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