What is uninsured motorist coverage?
Although automobile liability insurance is mandatory for Maryland drivers, I cannot urge drivers enough to carry significant uninsured/underinsured motorist coverage. Uninsured motorist (UM) coverage protects drivers when they are in a collision caused by a driver that has failed to obtain automobile insurance or when the offending driver cannot be identified (i.e. a hit and run or phantom vehicle scenario). While Maryland law mandates that all motor vehicles must carry liability insurance, data provided by the Insurance Information Institute estimates that over 15% of all Maryland drivers are unlawfully uninsured motorists. Moreover, neighboring states, such as Virginia and Delaware, do not have any laws mandating that drivers carry liability insurance, so victims of collisions caused by those drivers who enter Maryland may be left without recourse or a means to obtain compensation. When this occurs, you and the occupants in your vehicle may look to your own motor vehicle insurance policy to compensate you for your damages up to your policy’s UM coverage limits.
Underinsured motorist coverage (UIM) protects drivers and occupants of the vehicle who are involved in a collision caused by a driver who did not have sufficient coverage to compensate them for their damages. Maryland law requires a minimum of $30,000 per person, $60,000 per occurrence, for liability and UM/UIM limits. In this scenario, the insurance company will never pay more than $30,000 for any one individual or more than $60,000 for the entirety of all persons affected by a collision. At first glance, one might think those sums are sufficient, however, with the dramatic rise in medical costs, those sums barely make a dent in the medical costs in cases where there are serious injuries or where multiple people are injured. Keep this in mind, a brief trip on a Medivac Helicopter to Shock Trauma costs approximately $90,0000. A spinal fusion procedure for a back injury can easily run you upwards of $60,000.
Do I need uninsured motorist coverage?
UIM coverage can protect you from losing all your assets and going bankrupt from medical expenses or not being able to work when someone who has insufficient insurance coverage injures you in a collision. UIM coverage provides you, the occupants of your vehicle, and your resident family relatives with additional coverage up to the difference between the limits of UIM coverage and the at-fault driver’s bodily injury coverage. In other words, if the vehicle that caused the collision had $30,000 in insurance coverage and you carried a policy with $100,000 in UIM coverage, you could be entitled to additional compensation of up to $70,000 from your UIM policy once you receive the full limits of the bodily injury coverage from the offending vehicle. Keep in mind that you must first receive the full limits of bodily injury coverage from the offending vehicle before your UIM claim can become ripe.[1]
How much uninsured motorist coverage do I need?
With insurance costs always rising, many are lax to purchase sufficient coverage to protect themselves and their families. While purchasing the minimal amounts of motor vehicle insurance to become a legal driver in Maryland can be costly, especially if you have a negative driving record, it typically does not cost vehicle owners that much more to become sufficiently insured and to increase your protections. I recommend that all vehicle owners purchase a minimum of $250,000 (per person)/$500,000 (per occurrence) in coverage limits for both your Bodily Injury and UM/UIM portions of your policy.[2] If you have a family, if your family depends upon you for its support, own a business, have substantial assets, or need greater peace of mind, I always recommend obtaining at least $1 million in Bodily Injury and UM/UIM coverage. This additional level of protection will follow you and your family even if they are involved in a collision that does not involve a family vehicle.
While increasing your policy limits will likely increase your insurance premiums, this is definitely not an area of your budget where you want to skimp. Far too often I hear my clients proudly declare, “I have full coverage.” Full coverage by no means, however, equates to good, sufficient coverage. All “full coverage” means is that you carry liability and comprehensive coverage on your vehicle, and sometimes Personal Injury Protection (PIP) as well. Every day I meet with clients who thought they had sufficient coverage because they purchased “full coverage” wherein reality, all they have is a policy with coverage up to Maryland’s minimal limits of $30,000/$60,000.
Remember, it is extremely important to call and retain a personal injury attorney as soon as you can after any collision or injury you or a loved one sustains. You should reach out prior to speaking with anyone from any insurance company. As always, I remain available to consult with you in any injury situation or if you have questions about whether you may be entitled to benefits under any policy of insurance. Please contact me, Jason Wasserman, at (410) 385-9110.
[1] The procedural process for pursuing UIM claims is dictated by Md. Code 19-511 of the Insurance Article and can become very complex. You can easily waive your right to pursue a UIM claim of the mandatory steps dictated by the statute are not exactly followed, so it is very important to retain an attorney at the outset to assist you with this and all other motor vehicle injury claims.
[2] Typically the UM/UIM coverage limits mirror that of the bodily injury limits you purchase in Maryland policies.