As a personal injury attorney in New York, I see it all too often. A client has suffered serious injuries in a car accident. Another party is at fault. I make a claim against the responsible party’s insurance carrier. The problem is, the policy coverage is a bare minimum. It doesn’t matter how severe the injuries are, or even if the liability is a no brainer. The insurance carrier can’t and will not pay more than the policy limit.
An accident can be devastating. My client deserves compensation for endless medical bills, lost wages and in some cases, life-changing injuries. But what happens when the responsible party is not adequately insured to reimburse an injury victim? In New York State the minimum amount of bodily injury coverage allowed is $25,000. When medical and bills run into the thousands, even hundreds of thousands, this will barely scratch the surface of reimbursing a person should they suffer serious injuries. Worse yet, what happens if the responsible party has no insurance at all?
There’s good news. There is a way to protect you and your family from this situation. Insurance carriers in New York are required to offer Uninsured Motorist Coverage and Supplemental Underinsured Motorist Coverage. This is coverage for you to add to your own can insurance policy.
Uninsured Motorist Coverage, or UM, will protect you should you or a family member be involved in an accident with another motorist that does not have insurance. In such instances, your own insurance carrier will step in and act as the adverse insurance carrier. You can then make a claim against your own carrier and recover money. The amount of money that you can recover is based upon the amount of uninsured insurance that you purchase.
Supplemental Underinsured Motorist Coverage, or SUM, works in a similar way. However, it does not kick in unless the party that causes your injury has insufficient insurance policy limits to reimburse you or your family members for injuries suffered. The insurance will only be available if you collect the liable party’s entire insurance policy. Once you have done that, your carrier will compensate you up to your policy limits depending on the severity of your injuries.
Whether you are making a UM or SUM claim, the process is the same. The claim is handled in arbitration. Arbitration is an informal trial handled by a specially trained arbitrator. It is usually done in an office as opposed to a courtroom. The process is streamlined, usually taking about an hour to complete.
I highly recommend UM and SUM coverage to all my clients. It will cost a few dollars more a month, but the safety net is very much worth it. Ideally, no one would need UM or SUM coverage, but the low minimum policy limit in NYS makes it necessary. It’s better to have peace of mind of knowing you are financially protected.