In this article about uninsured and underinsured insurance coverage, we discuss the following:
- One in eight drivers have no auto insurance
- In Tennessee, nearly 1 in 4 drivers have no auto insurance
- With comprehensive coverage, you can protect yourself from irresponsible drivers
- Cheap car insurance provides no protection against irresponsible drivers
- Comprehensive auto insurance includes uninsured and underinsured motorist coverage of at least $100,000/$300,000
- Our law firm knowns how to maximize your collision coverage, contact us for help
The Problem: One in Eight Drivers Have No Insurance Converage
In 2019, 12.6 percent of motorists—about 1 in 8 drivers—were uninsured, according to a study released this year by the Insurance Research Council. Mississippi had the highest percentage of uninsured drivers in 2019 (29.4 percent), followed by Michigan (25.5 percent), and Tennessee (23.7 percent). In Tennessee, nearly 1 in 4 drivers have no auto insurance if they hurt you or your family in a car accident.
If 1 in 8 drivers are uninsured with no insurance, consider the amount of drivers that are underinsured with not enough insurance? Our law firm finds that most at-fault drivers are underinsured, meaning the at-fault drivers do not have enough liability insurance to cover the damages resulting from a car accident. These damages include but are not limited to, medical expenses, lost wages, car repairs, loss of enjoyment, physical and mental pain and suffering, loss of earning capacity, loss of consortium, loss of quality of life, and inconvenience.
State Minimum Limits
Unlike uninsured drivers with no insurance coverage, underinsured drivers maintain the minimum limits of car insurance coverage. Minimum limits are set by the states and have not been increased for years. As a result, state minimum limits have not kept up with the yearly increases in medical care.
In Tennessee and Kentucky, the minimum amount of liability insurance coverage required by law is $25,000/$50,000. Meaning that a single person can recover $25,000, but no more. If multiple people are in the vehicle, the auto insurance company will pay each injured person a certain amount, but the total amount paid will not exceed $50,000. The amount an injured person receives depends on the injuries and damages suffered. In trucking cases involving at-fault semi-truck drivers, the minimum coverage is $750,000 or more. But most car accidents involve personal automobiles.
Medical Care is Costly
Medical expenses after a car accident are extremely costly. In Tennessee, the medical bill for an emergency room visit averages $1,883.00. In Kentucky, the average medical cost of an ER visit is $1,740.00. See https://www.talktomira.com/post/how-much-does-an-er-visit-cost. If surgery is required, medical bills range from ten to fifty thousand or more, conditioned on the severity of the injury and the complexity of the surgery.
Health Insurance, Medical Payments and Lost Wages
Depending on the type of health insurance that you have, your health insurance company will cover some of your medical bills, but not all. Some medical expenses may remain unpaid, requiring future medical payments. Keep in mind that health insurance does not cover ambulance rides or life flights. And unless you have personal injury protection(“PIP”), which is offered in states like Kentucky and Florida but not Tennessee, an insurance claim for lost wages will be futile or deficient, especially if you are off work for extended time.
If an at-fault driver carrying the state minimum limits of car insurance hits you and causes a car accident, you can see how quickly $25,000 exhausts on medical expenses and lost wages. This leaves you nothing for physical and mental pain and suffering, inconvenience, temporary or permanent loss of earning capacity, and other damages you may be entitled to under the law.
The Collision Insurance Shortfall
When damages from a car accident exceed the amount of available insurance coverage, there is a shortfall between the amount you should recover and the amount you can recover from the at-fault driver’s insurance company. For example, if medical expenses exceed $50,000, but the at-fault driver’s insurance is nothing more than the state’s minimum limits of liability coverage ($25,000), there is a shortfall of $25,000 or more. The at-fault driver’s $25,000 in liability coverage is recoverable, but generally nothing more. Unless the at-fault driver is (a) wealthy with recoverable assets, and (b) unlikely to take bankruptcy to discharge a judgement, you will not recovery a penny more from the at-fault driver or the insurance company.
The Solution: Uninsured and Underinsured Insurance Claims
If you are injured in a car accident by an uninsured driver, or a hit-and-run driver, there is no bodily injury liability coverage to make an insurance claim for the damages suffered. These damages include medical bills, lost wages, inconvenience, loss of earning capacity, pain and suffering. Similarly, a car accident caused by an underinsured driver–an at-fault driver with minimum limits under state law–does not provide enough bodily injury liability coverage for your damages. The solution is to purchase uninsured motorist coverage (“UM”) and underinsured motorist coverage (“UIM”) and make certain it is listed on your auto insurance policy. Our law firm recommends your purchase at least $100,000/$300,000 of uninsured and underinsured car insurance. There are several types of uninsured motorist insurance (“UM”) and underinsured motorist coverages (“UIM”) to discuss with your insurance agent when you purchase auto insurance. The four main types are:
- Uninsured Motorist Bodily Injury Coverage (“UM” or “UMBI”) — pays when the at-fault driver causes a car accident;
- Underinsured Motorist Bodily Injury Coverage (“UIM” OR “UIMBI”) — pays when another driver causes a car accident but they do not have enough liability insurance to cover medical expenses, lost wages, pain and suffering;
- Underinsured Motorist Property Damage Coverage (“UIMPD”) — pays for damage to a vehicle if it is hit by a driver with insufficient insurance coverage;
- Uninsured Motorist Property Damage Coverage (“UMPD”) — pays for damage to a vehicle if it is hit by a driver without insurance.
Buyer Beware: Cheap Auto Insurance Does Not Pay When You Need It
We all want to save money, but when needing to use the insurance coverage purchased, you should not be wishing you’d purchased more. It’s important to plan for a car accident because they happen all the time. Consider how you will pay for bills if you cannot work due to injury. Protect yourself and your family when you buy the right auto insurance. Oftentimes, cheaper car insurance pays out very little when you need it most.
Some insurance companies like to advertise about how cheap their insurance coverage is. Cheaper insurance does not mean better insurance. This is true of auto insurance. Cheap car insurance results in grossly inadequate insurance coverage if you are in a serious car accident or hit-and-run accident involving an uninsured or underinsured at-fault driver. Without enough collision insurance, you are left with medical bills, lost wages, inconvenience, pain and suffering that far exceeds the coverage limits and the purchase price of UM and UIM coverage. If you are a homeowner with a family, an employer with drivers as employees, or just a single household driver looking to purchase or update driver’s insurance, be certain the auto insurance policy limits are commensurate to any potential damages you or others may suffer.
Making a Bodily Injury Liability Insurance Claim
In the unfortunate event of a car accident, you will have to make an insurance claim against the insurance company of the at-fault driver that hit you. If it was a hit-and-run accident, or the at-fault driver is uninsured or underinsured, a UM or UIM insurance claim against your own insurance company is necessary. Driver’s insurance with minimal policy limits will diminish any potential settlement recovery by virtue of a successful insurance claim, likely yielding far less than the damages suffered. These damages include medical expenses, lost wages, car repairs, loss of enjoyment, physical and mental pain and suffering, loss of earning capacity, loss of consortium, loss of quality of life, and inconvenience.
UM or UIM Insurance Claim
However, if you paid the premium for underinsured motorist coverage–UIM–then our law firm can make a UIM insurance claim against your insurance company for the shortfall. If it is a hit-and-run, we can make an uninsured motorist (UM) claim. Making a UM or UIM insurance claim against your insurance company does not raise the premium you paid. And the premium for UM and UIM coverage is often fairly inexpensive relative to the amount of coverage received for your purchase.
Comprehensive Coverage: Invest in Uninsured and Underinsured Motorist Coverage
To fully protect you and your family, carefully consider UM and UIM car insurance coverage. Speak with your insurance agent about it. These types of auto insurance coverage, and other types of uninsured motorist coverage, are specific categories of auto insurance that you buy to protect you and your family from an at-fault driver with little to no collision coverage. If you are unsure whether you have UM and UIM coverage or how much you have, our law firm strongly encourages you to do a quick check-up with your insurance company and review your auto insurance policy to make certain there is enough UM and UIM coverage (at least 100/300). We will gladly review your policy limits free of charge and inform you what your auto insurance coverage pays, simply contact us. However, we will need the declaration of rights page for your auto insurance policy, which you can obtain from your insurance company. This document indicates your policy limits, the premium paid for those limits, and any deductibles.
Comprehensive coverage includes liability limits of at least 100/300 (more if you can afford it), and UIM coverage of at least 100/300 (more if you can afford it). Higher limits are best. If you do not have UM and UIM or are considering purchasing additional, ask your insurance company for a free car insurance quote to see what the premium will be for the extra car insurance coverage and what it will cost per month. Insurance companies provide car insurance quotes for free, so we encourage you to shop around and find the best premiums and deductibles relative to the amount of insurance coverage you are purchasing. Discuss your insurance needs with a trusted insurance company before deciding how much UM and UIM coverage is right for you. Make sure it’s a fair price, but it is money well spent. UM and UIM is not extraordinarily expensive and is well worth the money when you or a family member experience the unexpected injury. Please contact us if we can help.
