By: Jason M. Melton, Esq.
Florida Injury Law Firm Whittel & Melton, LLC
We are Florida attorneys who combat Insurance Companies every day to pay the full value for our client’s injuries. In our years of practice, the same self-inflicted financial wounds appear and reappear with our clients— namely that our clients haven’t purchased Uninsured/Underinsured Motorist Coverage, commonly referred to in the industry as UM/UIM. It continues to shock us, that no matter how many cases we handle, folks would be in such a better position had they not been “penny wise and pound foolish” when it comes to insuring themselves or their family in what continues to be the most dangerous activity we all participate in…driving.
There is a subtle difference between uninsured and underinsured motorist coverage. Uninsured Motorist coverage (“UM”) is insurance that you buy as part of your automobile or motorcycle insurance policy that insures a driver and any passengers in your vehicle if an accident occurs when the other careless individual who caused the accident has no insurance. In practical terms, your uninsured motorist provider acts like the insurance company for the uninsured person who caused the accident, and hopefully is sufficient coverage for you or your passengers’ injuries. It protects you from naked drivers who cause accidents.
Underinsured Motorist Coverage (usually lumped in as “UM” or “UIM”) is the coverage that steps in when a negligent party’s insurance carrier has exhausted its policy limits. For example Driver A causes accident to Driver B. Driver A only has $100,000 of coverage and Driver B has damages that exceed $100,000. UIM covers the balance of Driver B’s damages. There is no greater coverage to purchase for a motorcycle or auto injury situation than UM. Let me repeat this: THERE IS NO GREATER COVERAGE TO PURCHASE FOR A MOTORCYCLE OR AUTO ACCIDENT THAN UM.
THE MYTH OF UNINSURED MOTORIST INSURANCE
The most common complaint we hear from clients when discussing their uninsured motorist policy is that they don’t want their premiums raised by making a claim against their own insurance company. This rate increase is a myth, and most likely is driven by Insurance industry propaganda about “loyalty” and “lack of claims” discounts.
Let’s discuss the law: Florida law absolutely forbids an Insurer from raising its rates on a customer for making a UM claim. For that matter, it also forbids the practice of raising rates if a passenger were to make a claim on your policy as well.
For those who doubt us, we will elaborate. Florida Law provides certain mandates for insurance companies to regulate rate changes. Variables like how many accidents you or your vehicles have been in lately, where you live, how often you are on the road and how far you regularly travel can impact your rates. For those who have been injured in an accident, the fact that the accident occurred is the only basis that an Insurance company could use to raise your rates. Unfortunately, this is out of your control. The fear of higher rates is NOT a reason to forgo making a claim on a policy of insurance you paid good money for. Your insurance carrier certainly had no problem demanding payment from you and you shouldn’t hesitate to require them to compensate you for the accident you sought to be protected from in the first place.
The simple fact is you are merely a policy number to your Insurance carrier. The Insurance industry has spent decades investing in sales customer service, television commercials and sponsorships to sell policies while waging a war on their customers by hiring defense lawyers and claims adjusters to delay, frustrate, minimize and many times, deny their customers’ legitimate claims. We can assure you, Florida Personal Injury Lawyers would be numbered, but for these simple facts. Your policy is a business transaction to them and no matter what “friendly, loyal face” they put on the transaction will ever change this reality.
HOW DOES A MOTORCYCLE OR AUTOMOBILE UM INJURY CLAIM WORK?
So, how does underinsured motorist coverage claim work exactly? Here is an example to show the process that takes place once an accident has occurred. Let’s say Sally is insured with Florida #1 Insurance and has a UM/UIM policy of $50,000.00. She is rear ended in a horrible accident by Chris who is insured by Florida #2 Insurance. Chris was a college student who didn’t spend much money on his policy and decided not to pay for any bodily injury (BI) liability coverage. After Sally went to the hospital, used an ambulance and was treated by a local chiropractor, her medical bills were well over $30,000.00. She also has thousands of dollars lost from not being able to work. In addition, her doctor’s predict she will have $50,000 in future medical care, which includes a surgery at some later date because of this accident. On top of this, the accident has caused Sally a great deal of pain to and will continue to do so.
As you can see, Sally already has an estimated $80,000 of past and future medical bills, lost wages and pain and suffering. But unfortunately, the at-fault driver purchased a terrible policy from Florida #2 Insurance. Had she not purchased any UM/UIM coverage, she would have had no redress for her losses. NONE.
At least in this fact pattern, you would hope that her policy with Florida #1 Insurance would be honored and they would pay. Clearly in this situation, Sally would have been better served by purchasing even more UM/UIM coverage. You just never know who is going to hit you on our Florida roads.
HOW MUCH UM COVERGE DO I NEED?
The above example shows you just why UM Coverage is so vital when you are in an accident. One day in the hospital can be as much as $10,000.00. The next logical question is how much coverage do I need? We advise our clients to purchase as much UM Coverage that they can afford because of how necessary it is. Sometimes we see policies where there is less UM Coverage than the liability coverage (BI) that protects the other driver. What people fail to realize is that they are insuring strangers for a considerably larger amount than what they’ve established to protect themselves and the loved ones that travel with them in their vehicles. If you can afford to cover strangers, then you can afford to adequately insure yourself, friends and family.
HOW DOES UM COME INTO PLAY IF I’M IN SOMEONE ELSE’S CAR?
UM Coverage also protects you and your family members when they are traveling in other vehicles, even if it is not your car. This includes scenarios where you may be a passenger in someone else’s car and they have little or no insurance to protect your injuries. UM Coverage will insure yourself, or any family member, if hit by a vehicle when acting as a pedestrian, riding a bike, or even sitting outside enjoying lunch at a restaurant and a driver smashes into the restaurant. It is essentially a large safety net to ensure that any out of your out-of–pocket fees that fall outside of the “wrongdoers” or the other driver’s insurance do not break the proverbial bank. If your injury was due to a motor vehicle accident, which was not your fault, then your UM Coverage will be useable where necessary.