What It Means to Have Uninsured and Underinsured Auto Coverage

Pennsylvania and New Jersey, like every state, requires you to purchase and maintain automobile insurance in order to legally drive a car.  This is called “financial responsibility”.  This insurance will include bodily injury liability – coverage for when a driver causes an accident and causes bodily or physical harm to someone. However both states only require a minimum limit of $15,000/$30,000 bodily injury coverage.  This means that the coverage is $15,000 max for a single claim, and $30,000 max for multiple claims (e.g. when there are three people in the car a driver crashes into).  Unfortunately not everyone can afford more than these minimum limits.  As a result you could be involved in a serious car wreck with someone and have significant injuries, medical bills, and lost wages while the other driver only has $15,000 in coverage.

This is where underinsured motorist coverage comes into play.  If a defendant’s bodily injury coverage is not enough to cover you for your bills, lost wages, pain and suffering, etc. you suffer as a result of a defendant’s negligence in causing an auto accident, you can recover additional money if you have purchased underinsured motorist coverage for your own car.  It is best policy to notify your underinsurance carrier about a potential settlement with a defendant driver whose bodily injury policy limits are not significant enough before officially settling your claim with them.

Just because you have underinsurance coverage does not mean your auto insurer will automatically give you that money.  They could dispute whether your damages are serious enough so that they are greater than the defendant’s bodily injury coverage.  Or they could dispute the amount of underinsurance coverage to which you are entitled.  In that case you will have to litigate an underinsurance claim with your auto insurer in court or arbitration depending on your auto insurance policy.  However your auto insurer does owe you a greater level of good faith and fair dealing than an auto defendant’s insurer owes in that situation.

You could also be involved in a hit and run accident, or an accident with someone who does not have auto insurance for their car.  In that scenario having uninsured motorist coverage is critical.  Otherwise it is unlikely you will be able to make a recovery because you may not be able to track down the hit and run driver, or the person who does not maintain auto insurance does not have much in personal assets to make a recovery against.

The Thistle Law Firm is experienced in handling both uninsured and underinsured auto accident claims.  If you have been involved in a serious auto accident and have concerns about whether a defendant has enough auto coverage to cover your injuries, the attorneys at the Thistle Law Firm are here to answer your questions at 215-568-6800.

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