We're Not Afraid

Many people pay their insurance carrier for years (decades even) and have what they believe is a good “rapport” with their insurance company; and yet many times they still get dropped for one or two minuscule claims. That is why it is often better to save making a claim for when it is a real and substantial matter, and an issue worth pursuing.

As such, you do not want to make minimal or semi-frivolous claims. It is best if you can save your insurance for when you REALLY need it; when it is important to use. The big one. Many insureds treat small or insignificant claims almost like a deductible; something you only write off. Many wisely feel that incurring a claim on your record, and having your rates raised (or being canceled altogether), for a mere $100 – $300 claim is simply not worth it. Nearly always, there will come a substantial accident, injury, and claim – all well worth pursuing, that will more than makeup for all of these insubstantial little matters you let slide. Likewise, many people adjust their “deductibles” to save money on their rates. Just changing the deductible amounts on claims from $100 to $500 can save a fair sum of money. Changing deductibles to $1,000 saves even more.

Many feel that, yes, a higher deductible will end up costing them a few hundred dollars out of their claim; however, they are not even going to MAKE a claim unless it is going to be thousands and thousands of dollars – a LARGE claim. Therefore, the thinking is, if the money saved in other areas (deductibles, med pay, towing, etc.) can be used to buy even higher amounts of UM/UIM coverage, then it was worth it. For if and when the large claim IS finally made, they want $500K or $1 million in UM/UIM policy limits to go after. That may sound like a lot of money, but many claims with disc injuries and surgery are $100K – $200K in just MEDICAL bills! Often they capture every penny of the $1 million UM/UIM policy. Obviously, one needs to weigh the potential for use (i.e. how often a claim MIGHT be made) versus the yearly premium savings, to determine if this is worthwhile for them.

Wise people look at insurance not so much for day to day, “nickel-and-dime” claims, but for the really serious and important ones. When looked at like this, things make a little more sense. If you save your insurance for something of magnitude; when the insurance company pulls your claims history [and they WILL review that, considering any prior personal injury claims] they will see you have a claim-free history. A plaintiff with ZERO prior claims. This not only tells them something about YOU, but it takes away from them one of their primary arguments; that of “preexisting” or “prior” injuries. This one of their favorite topics of discussion in accident cases, as well as a primary way they try to avoid paying a claim. A clean claims history not only helps establish you and your claim as legitimate but that you are not what they deem a “professional plaintiff,” or a chronic claims maker.

Insurance companies, unfortunately, love to forward these kinds of arguments. The odds are that you will be in at least one (if not two or three) major accidents in your life. The MAJOR claim is the one you are waiting for. THAT is the one you are carrying your serious insurance coverages for, and that is the one you want to be ready for when the time comes. If you are in a major impact, the odds are strong that you may incur some form of disc injury to your neck or low back. As previously indicated, symptoms from these types of injuries are often slow to manifest and may take a year or more to develop fully. Therefore, you want to be careful and not in a rush to “hurry up and settle” your claim. If put together correctly, these types of claims can be quite large. Unfortunately, many injured people do NOT have adequate insurance, or the right kind of insurance when this accident comes along; or, just as badly, they effectively help build the defense for the insurance company because of numerous prior claims.

If this is the type of case and injury you have incurred, and you have tried all forms and modalities of treatment; you may now be left with only surgery as your last option. Cases of this magnitude (depending on particulars) can go for $250K – $1 million, and even more if surgery is actually undergone. THAT is the case you want to be ready for, and carry adequate coverage for. With claims of that size, you also should consider aligning yourself with a top and respected structured settlement company, one which you can rely on and also be able to give you the type of coverage and setup you must have with a claim of seven figures or more. With the laws as they currently are, it is not only rare but often impossible to get the insurance company to pay out in full with a settlement of one million dollars or more. By getting the relationship now so when you need them it is a simple call. You simply cannot count on the opposing party, the often irresponsible person who caused the accident, to have adequate coverage to protect you from such an injury or claim. Only YOU can do that for YOU. What is frightening is how utterly common this type of injury is.

Just as there are insurance companies that tend to play the “shill game.” You may have seen this yourself, or been a victim on a crowded tourist street. There is a popular game called three-card monte. All you have to do is identify the right card after the dealer shuffles them. The person playing wins easily, over and over and as you watch, you can identify the card simply. “Easy money” you think to yourself, but when you step up, you lose. Thinking that you just weren’t paying attention, you play again and again. Soon, you are down $100 and walk away dejected. What you don’t realize is the person who was winning over and over was “the shill” and was in on it with the dealer. The same happens in the insurance and structured settlement industries. What you see isn’t what you get. You simply cannot count on the opposing party, the often irresponsible person who caused the accident, to have adequate coverage to protect you from such an injury or claim. Only YOU can do that for YOU. What is frightening is how utterly common this type of injury is.

Structured settlements were created with the good in mind. To help pay someone’s living and medical expenses over time that was seriously injured in an accident or a victim in a product liability case. Structured settlements can be traced back to thalidomide litigation back in the 1970s. Back then, the victims were infants who would need not only medical treatment but daily care due to the disfigurement they unfortunately had. Giving them a series of monthly payments was the best way to ensure their expenses were taken care of and their way of life would be the best possible under the circumstances.

Even though this was originally put together for the greater good, insurance companies quickly realized that a structured settlement was an inexpensive way to settle a lawsuit. How? Simply put, the figure offered would seem like a lot to the victim, but because it was paid over time, often in 20-30 years, the real value of the settlement was a lot less due to inflation and the difference of the value of future money compared to the value of money today.

For example, a settlement of $75,000 in 1982, paid over 20 years, actually becomes a hard cost of $10,000 to the insurance company. The same is true with a $225,o00 settlement, which cost the insurance company less than $15,000 to set up the annuity. This is all done through legal loopholes and victims are hurt again thinking they are getting a great settlement, but the terms and conditions of receiving the money are often not what they expected or what they were told verbally. The settlement offer they sign is different and some victims die before they receive a dime of the settlement money.

What happens if the victim dies? Sadly, many settlement agreements state that if the victim passes away the annuity returns to the insurance company. Yes, you read that right. This is why laws were changed to allow for victims to cash in their annuities and structured settlements for cash up front instead of waiting for the payments to complete or even start. If you decide to sell your structured settlement, make sure to pick DRB capital which is considered the best structured settlement company.

How can you avoid getting duped by an insurance company? Simply ask for the “present value” of the structured settlement that is being offered instead of the amount they are dangling in front of you. I guarantee you, if an insurance company offers you $75,000, but then has to tell you the present value is a mere $10,000 you are not going to accept their offer.

How do they do it? Just as in the example of the three-card monte, the insurance company uses “slight of hand” in order to fool you in thinking you are getting a great settlement, when in fact, you are not. Insurance companies state in their internal communication the importance of using structured settlements for company growth and profitability.

“The primary objective in the current and future use of structured settlements is to fully maximize corporate profits and growth while reducing claim loss and the rate of expense when it comes to claim settlement.”

You would think that structured settlements are only offered on large settlement offers, but you would be wrong. Structured settlements are offered even on claims as low as $5,000. If you are offered a structured settlement and do not receive the proper disclosures from the insurance company, chances are good you are going to get far less than you expect.

With payments often being in the 20-30 year range, your medical costs will only go up and what is affordable today will not be affordable in just a few years. This is especially true with medical treatment. Most medical care has doubled or tripled in the last five years. There are many people who have had their health insurance premiums double just in the last two years under the Affordable Care Act (ObamaCare).

You simply cannot count on the opposing party, the often irresponsible person who caused the accident, to have adequate coverage to protect you from such an injury or claim. Only YOU can do that for YOU. What is frightening is how utterly common this type of injury is.

In addition to obtaining the MOST UM/UIM coverage you can buy, there is another type of coverage that you should carry if at all possible. This coverage is called “umbrella” coverage. This is sort of “backstop” coverage, that covers you above and beyond your other normal existing coverages [such as homeowner’s, auto, etc.] if they prove inadequate. You can obtain umbrella coverage by normally having your homeowner’s (or renter’s policy) AND your auto policies with the same insurance company, in specified minimal amounts [usually $1 million each], and then they will sell you umbrella coverage in $1 million increments for a very reasonable sum; usually only a couple hundred dollars a year. Perhaps the most important and relevant use of umbrella coverage would be above and beyond your existing UM/UIM coverage. As such, if you had $1 million UM/UIM and then $1 million umbrella coverage, you would effectively have $2 million available to you for any accident, ABOVE AND BEYOND any coverage the person that hit you had. This is EXTREMELY good protection (and a bargain to boot) and would cover you for virtually any type of injury scenario.

This coverage, which goes above and beyond all existing coverages, is EXCELLENT coverage and especially so for the small amount of money charged. Umbrella coverage, in addition to healthy amounts of UM/UIM, is highly recommended. Further, this coverage is not only tied to your auto policies, but is a “backstop” coverage against your homeowners coverage as well, and will afford you excellent coverage for the money. This is coverage you should make every effort to obtain; as given the right accident/injury scenario, people have secured enough to never need to work again. A word of caution, however. Most insurance companies almost seem shy about offering or selling umbrella coverage, and you nearly always have to ASK about it, to find information about it and purchase it. Nevertheless, it is well worth doing and something that you should make every effort to do.

Sometimes, if you are making a claim against your insurance carrier and there is a dispute as to your coverage or whether it applies in the circumstances, your insurance company may write notifying you that they may be proceeding under a “reservation of rights.” (Meaning that they will provisionally cover the matter for now, but may later withdraw coverage after their legal counsel has a closer look at the circumstances) If they do this, frequently they provide you with your own separate, outside legal counsel [called “coverage counsel”] to advise you as to your rights in the situation. This is rare that a carrier would to this. Other than this limited situation, normally the above coverages are there to protect you in any home liability or automobile liability situations.

Resources

https://en.wikipedia.org/wiki/Structured_settlement

One important function every good attorney undertakes early on, is to ascertain the types and amounts of available coverage. This is vital and should be done as early on as possible. This issue can be re-visited often, and your information and strategy updated, as more information is developed. It is obviously useful to know if there is $15,000.00 in available coverage or $15 million! This again leads to the central point that to be TRULY certain of the coverage amounts and provisions, you should obtain and read the actual applicable insurance policy. If you are the actual insured, or a guest in the home or car of a named insured you have a right to a copy of the insurance policy.

Even if you are the opposing party (the injured plaintiff trying to obtain a copy of the policy from the defendant or his insurance policy) many states mandate that the policy also be provided to you. It can be asked for or obtained directly from the defendant (if he will); or from his insurance company (if they will, or if state law mandates); or from his insurance agent or broker; or in litigation under “discovery,” if that route must be taken. There are many ways to obtain a copy of the policy, and no particular way is the “right” way; just whichever way works. Some have even gone and obtained a small policy from the opposing insurance company just to see what their policy language and provisions include. Some have obtained insurance policies from the insurance agent or broker, or even from a secondary insurance carrier representing someone else involved in the accident [they sometimes share and exchange data]. If the insurance company refuses (when state law demands it), people have registered formal complaints with the state insurance commissioner.

At this juncture, it is important to make a clear distinction. Obtaining and reviewing a copy of the actual insurance policy and its provisions, IS NOT the same thing as obtaining the Declarations Page. This is an important document, in some ways maybe the most important document. The Declarations Page is the document that indicates exactly what the AMOUNTS of the actual insurance policy coverages are. The amounts; the types, etc. This is very important, and when used in conjunction with the actual policy itself [which explains coverages and prohibitions, etc.], you will have a complete picture of what you have and what you are up against, and will be able to more fully plan out your personal injury case and strategy.

When the policy itself as well as the declarations page is obtained, this is a good start to your case and can help determine what might be covered, whether there is stacking, etc. However, this is not the end of the analysis, only the beginning. Just because there may be ONE policy or set of coverages involved, this ABSOLUTELY does not mean that this may be the only coverage available or that can be involved. Different from “stacking” policies (the addition of multiple independent policies covering one insured) there is the principle of additive policies.

For instance, let us say that one day a person is walking to the store and goes to cross the street at an unpainted intersection; one that has a problem with the traffic light. This person gets hit by a car (traveling 40 m.p.h. in a 30 m.p.h. zone) and sustains catastrophic spinal and brain injuries and is in a coma. What potential policy/policies could this injured person pursue? The analysis can be long, but is often done by attorneys in the following way.

First, obviously one could and would pursue the driver of the vehicle. (He was speeding, and may be guilty of failure to maintain a proper lookout, negligence, etc.) Second, if the driver was borrowing the car at the time, we could pursue both the automobile OWNER’S auto insurance policy [of the car involved in the accident], as well as the DRIVER’S policy, who was driving the vehicle. Additionally, if the pedestrian had a vehicle which had medical payments coverage Med Pay, or UM/UIM coverage (uninsured motorist and underinsured motorist coverage, they are always listed together) we could pursue either or both of those as well.

UM [Uninsured Motorist] coverage covers being hit by someone with no insurance coverage at all, and UIM [Under Insured Motorist] coverage is for situations like this, where there are very large injuries and the available coverage from the defendant is inadequate. Med Pay coverage is medical payments coverage paid to medical providers for the medical treatment undergone as a result of an accident. Med Pay coverage is paid regardless of who was at fault. UM/UIM is very important coverage, and coverage that every person should have. This essentially covers you in an auto accident, as a driver or a passenger (or even as a pedestrian) when nothing else might. This is coverage you can always count on, even if the other party has no insurance at all, or only has the mandated state minimum policy (usually, $15,000.00). UM/UIM is probably the best (and most vital) all around coverage you can have.

Medical payments coverage is also important coverage to have as it covers medical bills. Neither Med Pay nor UM/UIM is mandated by the state to be able to operate a motor vehicle; these are optional coverages. However, UM/UIM is important coverage, and it is VERY unwise to operate without it. Finally, in our analysis of the scenario above, the pedestrian might have lawsuits against the city for an improperly working traffic control device and improperly marked crosswalk, as well as against (potentially) the contractor employed to perform those repairs (if any, and if they were done negligently). The list could potentially go on and on, but you see the point. Obviously, there can be many layers of coverage – – not just one – – and it is important to find out what those policies are, what is covered and the amounts of coverage involved.

This should also illustrate our prior point that, in essence, damages are king. Meaning, if the injuries and damages are severe enough, they will often drive the continuing search for more coverages and assets to make the injured plaintiff “whole.” Also, recognize there are other types of coverage that potentially could have been pursued. If the pedestrian had “umbrella” coverage he could have availed himself of that as well. [Umbrella coverage is additive coverage, which is also optional to obtain, and operates as sort of a “backstop” coverage, essentially above and beyond all other available coverages like UM/UIM, Med Pay, Homeowners, etc.] This “backstop” coverage, dollar for dollar and pound for pound, is THE best coverage there is.

Normally, if you have both your auto and home policies with an insurance carrier, in sufficient minimal limits like $1 million each; they will normally offer you umbrella coverage, usually in increments of $1 million, $2 million, etc., for only a couple hundred dollars a year. This is phenomenal coverage (especially for the amount charged), and coverage EVERYONE should seek to obtain if at all possible. Thus, if something truly catastrophic happened to guests in your home or auto, or you and/or your family; you would have very sufficient coverage to handle 99.9% of any accident scenario that could happen, without having to rely on some third party’s insurance coverage [if they had coverage at all]. After all, often people are uninsured or possess only the state mandated $15,000.00 minimum.

In our fictional scenario above, if our pedestrian had been hit by a combination semitractor/trailer, there may have been EVEN MORE levels of insurance to pursue. (There would have been the owner/operator’s own policy, the dispatcher’s policy, the shipping company’s freight policy, etc.; these are governed by D.O.T., I.C.C., etc. and mandated for all such trucks who must have these coverages). Further, we could take the analysis another step if the accident happened on private business property (perhaps at the edge of the property line), there may have been involvement with the premises liability policy (depending on the factual scenario). There are any number of policies which could be brought into play or involved in accidents like this. These are fact driven with many potential scenarios which would determine and dictate what kinds of coverages we might pursue. It is also important to note, that to “involve” coverage, one only need forward an arguable claim. Not everything at this stage needs to be 100% certain. When in doubt, forward the claim and let the insurance company(ies) deal with the matter.

The above fictional setting serves to illustrate that there can be many insurance companies involved with various layers of coverages. However, pursuing these commercial insurance policies are not the only possibility in circumstances such as this. There are other types of coverages. There can be claims involving the government or governmental agencies (selfinsured type claims), as well as state or local municipalities which are likewise self-insured [or that have self-insured retentions – like large deductibles]. Essentially, local, state and federal entities enjoy what is known as “sovereign immunity,” and are generally immune from lawsuits. However, almost every one of them has a statutory (partial) waiver of this sovereign immunity, in which they allow suit to be filed against themselves up to certain pre-determined threshold limits. Some entities have insurance; or are self-insured; or have a self-insured retention (basically self insurance up to a point, and insurance beyond that – like a deductible).

Each entity sets its own rules. Federal agencies allow suit to be filed via the Federal Tort Claim Act (F.T.C.A.) regardless of the amount of the claim. First, you must file a form (SF 95) and the agency has so many months to evaluate the claim and make an offer (or refuse to make an offer at all). You cannot file suit against the federal agency in federal court until the SF 95 has been filed with the appropriate agency, and either the time period for evaluating the claim has elapsed or the claim is denied. After that, a plaintiff has a certain period of time by which they must then bring their federal law suit.

In addition to the above, there are other types of policies. In some states, the regular automobile liability policies are labeled Personal Injury Protection (P.I.P.) policies. These not only offer the regular type of automobile liability and/or UM coverages, but these also offer an extended kind of medical payments coverage whereby a wide variety of things are included; as well as long term care and extended coverage, and wage loss/disability are also added to help someone fully recover. Often these policies allow coverages in the hundreds of thousands of dollars for surgeries, medical care, extended physical therapy, convalescent care, etc., and there are also extensive wage loss provisions as well which can provide someone with coverage for wage losses due to injury for years, in amounts totaling tens of thousands of dollars. This is very good and comprehensive coverage.

Obviously, each policy is unique and has unique provisions and coverage amounts. Each state mandates the minimum coverages a policy must cover. Such policies can be a valuable resource and should be investigated fully, even if one was merely a passenger in another’s vehicle. This is where reading the policy carefully and accurately can be of great benefit and extremely helpful to you.

An example of the importance of carefully reading an insurance policy, was made clear by two different salesmen who happened to work for a large Chevrolet dealership who were injured in unrelated auto accidents several months apart. Neither salesmen was at fault, and both were rear-ended by people who had relatively modest policies of less than $25K. Likewise, both salesmen had concurrent workman’s compensation claims because the accident happened while they were at work. However, there are legally set limits on what can ultimately be recovered from workman’s compensation, regardless of your injuries.

Because both salesmen were fairly hurt, the hunt was on to try to find additional policy limits. Neither had their own UM/UIM policy limits, and it was assumed that because workman’s compensation was involved that ALL they could receive was the negligent, third party defendant insured’s policy limits. Finally, someone exercised due diligence and demanded a copy of the policy from the EMPLOYER’S (Chevrolet Dealership) automobile insurance company. This was met with immediate hostility and resistance; both from the Chevrolet Dealer as well as from their insurance broker and insurance company. All involved tried to claim that the workman’s compensation policy was the “exclusive remedy” to the salesmen and all that they could go after. Normally, this would be the case in a properly constructed and written policy.

The employer/auto dealer (Chevrolet) and its’ automobile insurance carrier were none to happy to provide the policy – but they were required to by law. Both entities assured the salesmen that this dealership had been around for many years and that workman’s compensation was all that was available to them or that they could receive; and that the policy provided no coverage for them. They were wrong! Quite plainly the insurance policy had a provision for UM/UIM coverage (even though the dealership insisted that this was meant only for the owner and the general manager of the dealership). Unfortunately for them, the policy was not written that way, establishing such exclusions.

Because of a careful reading of the policy, and the provisions which were there (and NOT there) and not just making assumptions or listening to other people, BOTH salesmen ended up receiving policy limits from the respective 3rd party defendants AND from the Chevrolet dealership (UIM) auto insurance policy. Needless to say, the dealership management was quite upset but could stop none of it. The dealership automobile insurance company did not want two bad faith claims ON TOP of the UIM claims. So, the dealership that had gone for years without any such claims, suddenly had two claims against it.

Everyone involved learned a valuable lesson about READING THE POLICY! Simply “assuming” things had created this situation and allowed it to go on for years. The policy was later changed to specifically EXCLUDE salesmen or anyone receiving workman’s compensation claims, which is perfectly legal and how most policies are written. However, by then the dealership had two chargeable claims against it. The salesmen later went back to work there, as they were legally protected under workman’s compensation law and entitled to their jobs again. Simply reading the policy proved very valuable for both men; and it also made one wonder how many other salesmen over the years could have used the policy, but did not, simply because they either listened to the dealership personnel or DID NOT READ THE POLICY?!

The above are examples of just some of the different types of coverage that could be available to you in auto accident injury cases. Similar provisions might be found concerning a different type accident involving a different policy; for instance a premises liability policy involving a slip and fall or an injury on commercial property. Finding out all that you can, and all of the benefits and provisions available to you, simply takes being a little creative and looking for all possible policies or avenues of coverage, and writing a few letters. Simply exercising a little diligence. In addition to finding out about types of coverages and provisions, one may also find out about policy size from the adjusters themselves. Sometimes they will outright tell you, but some have misgivings [or there may be company policy against that] and feel like people would “over treat” and run up huge medical bills if they knew there was a large policy. More often, insurance adjusters will not necessarily “tell” you [or be able to] policy limit amounts, but they can and often do give you strong hints. So, even if they will not tell you outright, there is still information to be had there.

For instance, an adjuster might state that the vehicle insured has “small” policy limits (generally meaning a minimum $15K policy or at most a $25K policy); whereas if they indicate a “medium” policy limit is involved, they generally mean a $25K to $50K policy. Stating their insured has a “large” policy limit amount, usually means $100K or more. If the adjuster indicates that the policy limits are “extremely large” or indicates that policy limits are “adequate/or adequate regardless of claim size,” this generally indicates the largest size policies of $1 million or above; or as a minimum $500K. The reason they say “adequate” is just that; virtually no matter what size the claim ends up being, those policy limits are usually sufficient. Thus, even though you may not always get the exact number from the insurance company, even these hints can be of benefit to you in determining what is, or may be, available for your claim.

You can find also sometimes find policy information in a variety of places. You can do online searches or do basic legal information searches. One common place to obtain other insurance information is from the insurance companies themselves, or from brokers or agents. Often times insurance companies will write other insurance companies with their questions, concerns, or theories of liability. Likewise, they write and put other carriers (and parties) on notice that they have “subrogation” rights (the right to recover or recoup amounts they have expended on a claim that was not “their fault,” etc.). Often, insurance carriers are more candid with each other than they are with claimants. Sometimes, just simply asking one carrier, [such as asking your own carrier for a copy of their file] or “poking around” a little bit can often yield the results you seek.

Just as important as finding out what available insurance policies and provisions are out there and available to you, is making sure you have adequate insurance YOURSELF! This cannot be stated clearly enough. Many times people end up having serious injuries and have very inadequate insurance or no insurance at all. This is unfortunate. This may, or may not be the situation with the reader of this guide. If an accident has already occurred, then it is a little late for THIS situation. However, this can and should be a prompt to insure your coverages are adequate in the future, and if necessary increase your insurance coverages. Whether it be homeowners, disability insurance, auto insurance, or whatever the case may be; there is really no such thing as “too much insurance.” However, the realities of modern life are more a matter of what one can afford. So we will explore what the best coverages are outright; and then the best coverages for the money, if one is on a budget.

A homeowners or renters policy is always wise. It is relatively inexpensive (for the coverages granted) and a good idea. It is broad, far reaching coverage. Disability insurance is likewise a good idea. It can help cover medical expenses and wage losses from either on the job or home injuries. Automobile insurance is something every driver must carry. The problem is, many people carry only the “state mandated minimum” coverage, which is usually VERY inadequate coverage. Yes it is cheaper, but you are getting what you pay for – very little.

A much better plan is to pick and choose what is the best coverage available for the money, the biggest “bang for the buck.” Auto accidents are by far the most common accident and therefore auto coverage comes into play more often than most other coverages. Structuring your auto coverage in the best way possible, so that you get the most coverage for your dollar makes the most sense. First off, most state mandated minimum liability insurance coverage is $15K/$30K/$10K coverage. This means that for any given accident, an insured is covered up to $15K per person, maximum; $30K total aggregate, this is the maximum total amount of injury coverage, regardless of the number of people involved in the accident; and $10K in property damage coverage. That is the full extent of state mandated minimum insurance coverage. This only provides coverage to OTHERS, to people you hit or damage. This provides you with NO coverage for yourself or your guest passengers.

Above these damage limits you are on your own. Not only are these extremely low coverage amounts, but damages ABOVE these amounts would come from the insured (you) personally. Therefore, this inordinately low coverage could put at risk your home, your bank accounts, 401k’s, property, etc. It is not wise to keep your coverage this low. Further, and perhaps even more importantly, the coverages that can and DO help you (UM/UIM) are affected by these numbers. Your UM/UIM coverage cannot exceed your liability coverage, so to have high limits there, we must have high liability limits.

Ideally, you want as much UM/UIM coverage as you can possibly get, period. THIS coverage is what covers you and your family and guest passengers. This coverage protects you if the person who hit you has NO insurance; or has very MINIMAL insurance. It further protects you even if you are a pedestrian, or are riding your bicycle or are riding in another person’s car as a passenger. UM/UIM coverage is some of the best coverage out there and you want as much of it as you can get. However, remember that your UM/UIM cannot exceed your liability coverage.

So, if you want $100K/$300K, (or even better still $250K/$500K or $500K/$1 million in UM/UIM coverage), you need to carry that amount of liability coverage. Luckily this insurance gets cheaper [per unit] the more you buy. So, adding $25K UM/UIM might cost a little more than basic coverage, but not that much more. Further, increasing to $100K is only a little more still, not 4 times what $25K cost. Likewise, $250K or $500K UM/UIM is only a little more still; maybe two or three times the $25K premium. It simply is not that much more money, especially considering the protection you receive. UM/UIM is truly outstanding coverage; and coverage you should NOT do without. The only coverage that MAY be better, especially dollar for dollar is umbrella coverage. It is best to have both.

If you have limited funds you may wish to forego other coverages to help fund the UM/UIM. One coverage that gets sold on auto policies quite often is medical payments coverage. If money is tight, it is recommended you forego this coverage. Although it does provide coverage for medical expenses, it is usually capped at $5K or sometimes $10K (rarely as high as $25K); but the AMOUNT you must spend for this coverage is out of proportion to its value to you, especially relative to other coverages. Further, the benefits usually go right to the medical provider, not YOU.

For instance, the premium one would pay for $5K in med pay coverage, might buy you $100K of UM/UIM coverage. There is no comparison. On the one hand you get $5K paid to your medical provider. On the other hand (probably for less money) you could get $100K UM/UIM coverage payable to YOU for your injuries. With a substantial UM/UIM amount like that, you could even find a medical provider who would treat you on a lien, with no out of pocket expenses, for any medical treatment you might need. Even if you needed to treat on a lien with a doctor for your accident injuries, you would still have a significant portion of the $100K left over for you at the end, for your pain and suffering. You can see the obvious advantages with the higher amount of coverage. Comparing $5K to $100K for the same money, it just makes more sense if you can only afford one coverage, UM/UIM is the way to go instead of just med pay.

Many people opt for towing and roadside assistance coverage on their auto insurance policies. Again, not a bad idea if you can afford it. If money is somewhat tight, your money is again much better spent getting UM/UIM coverage. Even if you paid for these coverages, the amounts covered by this insurance are very minor amounts. Does one really need to be insured against $100 – $200 charges? Further, if you ever make a claim under either roadside assistance or towing coverages, even for a minor amount of money, these STILL count as a “claims.” If you make two of them, most carriers will cancel your insurance, as this counts as 2 claims! (Even if they are only two, $100 claims) Again, these coverages compared with what UM/UIM provides there really is not comparison. You simply get much more (and better) coverage for the money.

Overall, it is simply difficult to beat the overall coverage and “good value” provided by UM/UIM coverage, and this should really maximized however possible. Obviously, if money is an issue, dropping unnecessary coverages like the above med pay, towing and roadside assistance will certainly help. In fact, even if one needed to raise deductibles (from $100 to $500 or even $1,000) this would help free up cash to pay for UM/UIM. Likewise, if even deeper cuts were necessary (comprehensive coverage, etc.) this still would make the most sense, as UM/UIM covers so many injury scenarios. This truly is the best coverage to have. Any way you slice it, UM/UIM is the one coverage that protects YOU, and pays you for your injuries, regardless of whether the person that hit you has adequate coverage or not.

More often than not, if there is an insurance policy out there, it may very well (or at least arguably may) cover the conduct or accident involving you. Many policies may be used one after the other in an additive way. This depends on policy language and clauses, and to some extent state law. If uncertain if there is coverage, it is best to tender a claim to ALL possible involved insurance companies. If they believe the matter is not covered, or should be denied, make them place that answer to you in writing. Always seek to make sure that what is told to you is put in writing. If this is not done, and you are answered telephonically, as a minimum do what many attorneys do, write a “confirming” letter regarding any important issues.

For example, write an insurance company, “This is to confirm our telephone conversation of the date of – -/- -/–, wherein you and I spoke and you indicated X, Y and Z. If this is NOT accurate, or not your recollection, please write me back immediately and correct my misunderstanding.” This helps because it not only memorializes the conversation, but it puts the onus on the insurance company that if they do not act or write to correct this, then things will be considered to have been as you described them in your letter.

Likewise, it is often wise to send materials to insurance companies via fax and letter (registered mail, return receipt requested). Retaining and attaching to the correspondence the receipt, for use later as proof of notice and knowledge of the matter, if forced into litigation. Insurance companies as well as attorneys for that matter, often have conveniently selective memory. Do NOT trust them and do NOT just believe them; ever. Not even once. Everything needs to be in writing to fully protect you. If it is not, if later the matter goes to trial; in court an insurance company can later deny it. To the court, it will be as if it did not happen! In the law, ORAL MODIFICATIONS TO A WRITTEN CONTRACT have no bearing and are not admissible, and this is very analogous to that principle. Involving in “He said . . ., she said . . .” before a court means very little. They require and rely on PROOF. Always document your claim, and any potential future lawsuit, as thoroughly as possible to avoid any future issues.

The very first issue you must deal with is NOTICE. Giving notice to any and all involved (or potentially involved) insurance companies is vital, and required in virtually every insurance contract. Insurance companies mandate that they be put on notice of claims (or potential claims) so that they may properly investigate, preserve evidence, take photographs and witness statements, and so on. There are many pieces of important evidence available at the beginning of a case, that might disappear later. Insurance companies want (and have a right) to adequately preserve evidence, investigate a matter and put on a defense if need be. Their rights can be materially affected by not giving them appropriate notice, and failing to do so is an excellent way to have a claim denied and/or pushed into litigation.

Further, if the insurance carrier is your own, 1st party coverage, failing to give them notice [or even timely notice] may give them cause to deny coverage altogether. Do not give them the easy way out! Always put insurance companies on notice, IN WRITING, at your earliest opportunity. If you have difficulty locating an insurance company or their claims office, the state insurance commissioner is an excellent resource in helping to find them. (And would also stand as evidence that you were trying to locate them and put them on notice)

Placing companies on notice is as simple as giving them all of the germane facts. Essentially, what happened, when, the location, and if in an automobile claim (the information on the vehicle and the other driver). If you have filled out an accident or incident report, or a security department accident form, or a police report; any paperwork you have filled out already, should be sent to them in the form of a “courtesy copy.” They are going to obtain this material anyway, you might as well be as helpful and cooperative as you can right from the beginning. This sends the right message and the adjuster will appreciate it.

Sometimes, you will encounter people who do not want to notify the insurance company. They may be the third party driver that ran into you; the person whose car you are riding in; or the shop owner whose store you happen to be visiting, etc. Whatever the case may be, it is strongly recommended that you do not succumb to such advice. This is poor, and frankly, very self-centered, advice. The only one who benefits from this is the other party, not you. Many times (in fact, with the more serious disc type injuries), MOST of the time; you are not even fully aware of all of your injuries – or at least the full extent of them – early on. Sometimes it takes months, or even years, to fully comprehend the true nature and extent of your injuries, let alone undergo all the treatment, physical therapy, and possibly even surgery.

We cannot know everything that early on; and you do not want to do anything which could possibly impact your ability to receive medical care or compensation. Further, someone urging you to do this is doing themselves no favors either. By doing or encouraging this, they are placing at risk the very coverage that they paid for. Insurance companies can, and DO, deny coverage for just such behavior. This is all foolish and unnecessary. Make sure you report ALL accidents and incidents (make written reports) at the time they happen. You will be glad you did.

One additional positive point about placing the respective insurance carriers on notice, is that YOU will be the one placing them on notice. YOU will be the one filling out the incident or accident report, or even the police report. As such, it is a unique opportunity to state not only the facts, but to insure that important facts and facets of the case that would not normally be heard will see the light of day. Many times, the initial incident report becomes pivotal in the case later on. Would you prefer to leave the filling out of this important and vital document to someone else? Obviously not. Sometimes, this requires you to take the initiative, and actually go somewhere to fill out this report. You may need to travel to a company’s headquarters or security department to fill out an accident/incident report.

You may have to fill out forms with your employer if it is a work comp case. You may have to drive to a police station to fill out a report, as many large metropolitan police departments are getting overwhelmed and only respond to the most serious accidents, therefore leaving minor auto accident cases to fend for themselves. As such, you want to make sure that you get the facts straight and YOUR story out there, and there is no better way to do this than through the accident report. Sometimes, the opposing party files a police report, and it may skew the facts in their favor. Regardless of this, you still have a right to file your OWN report and version of the facts; and you should. You have the right to do this. So, spend the time to do this, and do it right and it will certainly pay dividends in the end.

Also, recognize that even if a report (or police report) is filled out by someone else, these reports [including a Police Report] is actually inadmissable hearsay and cannot be used at trial
– unless “party admissions” (statements made by the other party, directly to the person filling out the report). The reason this is “hearsay” is that the police office or security guard filling out the form was not there during the accident. Therefore, they could not speak directly to what happened. This only becomes different if the incident was actually witnessed by the party filling out the form. These reports are normally made for the insurance company, and for their consumption. So, if you can influence the facts or report things in a light most favorable to you, do so. If the facts are against you, take it with a grain of salt as 99%+ of the report writers were NOT THERE during the accident, and ultimately the report means very little, other than to identify the parties and the basic facts of the accident/incident.

In addition to policies being used one after another in additive fashion, policies (most notably some auto insurance policies) can also sometimes be “stacked.” This means if a certain coverage were had on a vehicle of “X” amount, and if there were three such vehicles and the same amounts of coverage on each vehicle from the same carrier; [even though the accident may have involved only one of the insured vehicles, the coverages from ALL of the vehicles may be “stacked” such that there is now three times the amount of coverage (3 times “X” coverage).

Thus, if “X” were $25,000.00 (say of UM coverage or medical payments coverage), stacking would now allow there to be $75,000.00 in overall coverage available to you [along with any other available or applicable coverages]. Policies may generally only be stacked by named insureds, resident relatives or family members. Sometimes uninsured passengers riding in the vehicle itself can also, but sometimes they are disallowed by the policy. (In which case, they would only get the single policy limit) Check your individual policy provisions.

This stacking is allowed in some insurance policies and some states, so you must look at the prospective policy to verify if this is allowed. Also, some states have or mandate “anti-stacking” language. (Nevada, etc.) This means that if there is no clear, anti-stacking language printed within the policy, that UM/UIM stacking is to be granted. Therefore, this type of multiple coverage can be CONSTRUED to be there, if it was not explicitly declined. The same thing applies to medical payments coverage (“med pay” provisions). Likewise, if either UM/UIM or med pay is not SPECIFICALLY DECLINED, it can be “construed” to be there; some states hold this as well. State law and the policies themselves need to be checked to verify this.

Also note, there are other unique provisions in some policies, such as “seat belt” provisions, wherein medical payments coverage or other coverages can be doubled (or the like), if seat belts were utilized in the accident. (Nationwide, Colorado Casualty, etc.) The point is, there are numerous types of different policies and policy provisions. One must simply obtain the respective insurance policies and read them, before they can be properly employed.

In addition to the stacking of UM/UIM policies in some states, there are sometimes rules regarding hit and run type accidents. Many states allow for accidents such as someone running you off the road, where they did not actually strike you or your vehicle; but you were nevertheless injured. However, other states are more stringent and require that there actually be “contact” between the vehicles, a physical touching. This is driven by insurance company fears that people may abuse the system and have merely run off the road or fallen asleep; and are simply trying to blame their own negligence on some unknown third party. As was discussed previously, you cannot be at fault for your own accident and receive compensation for your injuries [although you COULD recover your medical payments coverage money, as this is paid irrespective of fault]. Unfortunately, what translates from “insurance company fears” often becomes the LAW. Pretty much whatever “concerns” the insurance companies, or whatever they want done; legislatures almost universally pass into law at one point or another. They are very attuned to the wants, needs and desires of the insurance industry. They have tremendous pull and influence, largely because they are among the biggest contributors to political campaigns.

At this point, it is important to make a couple of observations. First, just because many references have been made, and will be made, to auto accidents (they are by far the most common personal injury case), it does NOT mean that these ideas and principles will not, or do not, apply equally well to other areas of the law and insurance policies. (i.e. products liability, premises liability, professional liability [doctor, lawyer, CPA, dentist, etc.], and many other areas). Secondly, it is VITALLY important to spend (or rather, invest) a little time learning what the appropriate policies of insurance are, or may be, involving your case and claim; what their provisions are and how they may be used to your benefit.

This is so critical and vital to every case, but seldom done. Probably half of the attorneys out there do not do an adequate job of this in one way or another. This one step can pay off dividends in SO many ways: it can inform you of the ultimate amounts you may be able to potentially recover; if there are any prohibitory clauses; if the policy(ies) allows stacking; if there are doubling provisions or medical payments coverage; and 101 other things. You simply are not doing a proper job, or doing yourself any favors if you skip this step. DO YOUR HOMEWORK FIRST, and learn what the insurance policy covers and which provisions apply!