Understanding insurance is hard. There are many ways you can get tripped up on claims, discovering too late that you either do not have the requisite coverage or are excluded from recovery, all to your financial detriment.
We all want to get the best bargain. We want to save money. However, one thing in life you absolutely do not want to skimp on is automobile insurance.
Each state by law determines what coverage you must purchase and what is the minimum amount of coverage you must have on your motor vehicle. Maryland, for example, mandates that you have liability coverage and uninsured motorist coverage. That is it. All other coverages, i.e., collision, comprehensive, rental car, etc., are optional or can be waived, including personal injury protection coverage.
Maryland requires that liability and uninsured motorist coverage be at a minimum 30/60/15 – explained below. First let’s discuss “liability” coverage. This protects you and your assets up to the stated limits if you or your driver wrongfully injures one or more persons or their property. This means that if you purchase the minimum coverage the most your insurance company will pay if you injure someone in an accident is $30,000. If they cannot work, need extensive medical treatment including an operation, suffer a permanent injury, have expenses in excess of $30,000, your insurance company will only pay $30,000. If you wrongfully injure 2, or more people the most that insurance company will pay is $60,000, with no one party receiving more than $30,000. Say you are in an accident where someone’s new car is a total loss, the most your company will pay is $15,000 – for the value of the car, towing, storage and rental.
If you have minimum coverage you and your assets are at great risk. The injured party/parties or their insurance company can go after your personal assets to pay for personal injury claims worth more than $30,000 and motor vehicle damage worth more than $15,000.
Your bank account can be seized, your wages garnished and other bad things can happen if someone obtains a judgment against you in excess of these minimums. Therefore, it is important to make sure you have enough insurance.
Uninsured motorist coverage is the reverse of liability coverage. It protects you if the other driver has no insurance or does not have enough insurance to pay for your medical expenses, lost wages and all the pain and discomfort you were forced to endure. What if the responsible party has a minimal policy and does not have any assets you can seize to pay for your excess claim over $30,000? If your uninsured motorist coverage exceeds the other driver’s liability coverage you can make a claim for the difference between your own coverage and the liability coverage of the other driver. For instance, if you have $100,000 in uninsured motorist coverage and you were struck by a driver with a minimal policy, you could recover $30,000 from the other driver’s insurance, and $70,000 from your own insurance company. Essentially, you are setting the minimum level of insurance every other car on the road has with your uninsured motorist coverage.
Finally, the Maryland General Assembly has recently passed a law requiring insurance companies to offer enhanced coverage starting in July 2018. This would potentially allow for even more insurance coverage in the event you are struck by an uninsured or underinsured driver.
It is therefore very important to insure you have enough insurance coverage to protect you and your family. Make sure to have your auto insurance coverage and amount of coverage reviewed by a competent attorney. Let us help you determine what coverage/coverages are best to protect you and your family. Contact attorney James Cleaver at 301-292-3300 or via email at email@example.com to set an appointment to review your insurance policies.