How To Protect Yourself And Your Family Before An Auto Accident
Far too often we have to tell our seriously injured clients, or clients who have had family members killed in auto accidents, that the negligent driver, who caused all their misery, either doesn’t have liability insurance, or has inadequate liability insurance coverage.
Ohio law requires all drivers/owners of automobiles to carry liability insurance. The minimum liability limits required by Ohio law are $12,500.00 per person and $25,000.00 per accident. This means that if a drunk driver kills four (4) people in an automobile accident, the most his insurance company has to pay is a total of $25,000.00, with no one person’s estate recovering more than $12,500.00.
Ohio’s minimum limits are one of the lowest of the 50 states. For years, lawyers that represent injured persons have tried to get the legislature to raise the minimum liability limits, but the insurance companies have opposed us. As a result, the legislature has refused to raise the limits.
Of course, when you obtain automobile insurance, you can purchase higher liability limits. The higher the limits, the higher the cost. Commonly, we see in our practice that the negligent person is carrying liability limits of $50,000.00 per person and $100,000.00 per accident. It is rare that we see a negligent person having more than $100,000.00 per person and $300,000.00 per accident in liability coverage.
THIS IS NOT ENOUGH COVERAGE TO COMPENSATE MOST OF OUR SERIOUSLY INJURED CLIENTS OR FAMILIES WHO HAVE LOST LOVED ONES
HOW CAN YOU PROTECT YOURSELF AND YOUR FAMILY FROM THIS? SIMPLE, BUY UNINSURED AND UNDERINSURED MOTORIST COVERAGE.
Uninsured motorist (UM) coverage protects you when the negligent person has no liability insurance. Although it is illegal to drive without insurance, many Ohioans are dropping their auto insurance coverage because of the bad economy.
Underinsured motorist (UIM) coverage protects you when the negligent person has liability coverage, but in a lesser amount than your underinsured motorist coverage and your injuries and damages exceed the negligent person’s liability coverage.
EXAMPLE: A drunk driver runs a red light and T-bones you. You sustain multiple fractures. The drunk driver has liability limits of $12,500.00/$25,000.00. You have UIM limits of $100,000.00/$300,000.00. You can obtain up to $87,500.00 under your UIM coverage assuming your case is worth this.
Note: Under Ohio law, UIM coverage is not excess coverage and your insurance company gets to set off the drunk driver’s liability limits ($12,500.00) against your UIM coverage ($100,000.00).
Unfortunately, Ohio law does not require your insurance company to offer UM, UIM or both UM and UIM coverage. Ohio law did require this before 2001 but under pressure from insurance companies, the legislature did away with mandatory offering of UM and UIM coverage on October 31, 2001.
BECAUSE OF THIS, YOU MUST REQUEST UM AND UIM COVERAGE FROM YOUR INSURANCE AGENT/INSURANCE COMPANY WHEN BUYING AUTO INSURANCE.
DO NOT LET YOUR INSURANCE AGENT/INSURANCE COMPANY TALK YOU OUT OF UM/UIM COVERAGE TO HOLD DOWN COST.
UM and UIM coverage is not that expensive. In our experience, the cost of UM/UIM coverage of $250,000.00 per person and $500,000.00 per accident is about ½ of the cost for liability coverage in the same amount.
EXAMPLE:Comprehensive Bodily Injury Liability-$250,000/$500,000.00 and
Property Damage Liability-$100,000.00 each accident
Cost is $260.00 per 6-month period.
Uninsured/Underinsured Motorist Bodily Injury-$250,000.00/$500,000.00
Cost is $65.00 per 6-month period.
Always buy both UM and UIM coverage. The cost you save by buying only one is minimal.
If you want to reduce the cost of your automobile insurance, you are much better off increasing the deductible on your comprehensive and collision coverage than eliminating or reducing your UM/UIM coverage.
Another way to reduce the cost of your automobile insurance is to reduce or eliminate medical payments coverage. Medical payments coverage pays medical bills incurred by you or a family member as a result of an automobile accident up to whatever your coverage is, generally $5,000.00.
Unfortunately, both the Ohio legislature and the Ohio Supreme Court have OK’d policy provisions in automobile insurance policies that allow your insurance company to effectively reduce your UM/UIM coverage for any money it pays under your medical payments coverage. This is true even though you pay separate premiums for UM/UIM coverage and medical payments coverage.
If you have good health insurance coverage, you only need medical payments coverage to pay your health insurance co-pays and deductibles.
We recommend that everyone carry at least $100,000.00/$300,000.00 in UM/UIM coverage and if possible, $250,000.00/$500,000.00 with a $1,000,000.00 umbrella.
Umbrella coverage is really not very expensive because the insurance company knows from actuarial studies that the odds of a claim exceeding $250,000.00/$500,000.00 are not that high. However if your case exceeds the $250,000.00/$500,000.00 primary limits, you will be thankful you have the $1,000,000.00 umbrella.
CAUTION: When purchasing umbrella coverage, make sure it includes UM/UIM coverage. Many insurance companies will sell you umbrella liability coverage but won’t tell you that it doesn’t include UM/UIM coverage.
IF YOUR INSURANCE COMPANY DOESN’T OFFER UM/UIM COVERAGE, RUN, DON’T WALK, TO AN INSURANCE COMPANY THAT DOES.
In our experience, many insurance agents do not understand UM/UIM coverage. It is necessary for you to read your insurance policy to make sure you have UM/UIM coverage, and if so, whether there are any provisions excluding coverage. There most likely are.
Insurance policies are written by insurance companies, for insurance companies and to benefit insurance companies, at your expense. Insurance companies purposely write insurance policies so you can’t understand them. In fact, many lawyers cannot understand them, but we can because we have been dealing with insurance companies for many years.
Regardless of how difficult it is to read and understand your auto insurance policy, you must do it.
If you don’t understand it, which you most likely won’t, call your insurance agent or insurance company and ask them to answer your questions. Also, ask them to put their answers in writing.
When you read your policy, look for the following exclusions under your liability and UM/UIM coverage.
The “Family Exclusion”:This exclusion eliminates liability coverage and UM/UIM coverage for you, members of your family or your household.
EXAMPLE:A family is driving to a high school football game. In the family car are husband, wife and their three (3) minor children.
They have an auto insurance policy with $500,000.00 of liability coverage and the same amount of UM/UIM coverage and $5,000.00 in medical payments coverage. The husband, who is driving, loses control of the car and seriously injures his wife and three children. Wife and children have combined medical bills of $200,000.00. Their auto policy has a “family exclusion.” Under this exclusion, the wife and children have no coverage at all under the liability or UM/UIM provision of their policy for husband’s/dad’s driving negligence. This is true even though Ohio law allows claims by the wife and children against husband/dad. They are entitled to receive only $5,000.00 per person in medical bills for a total of $15,000.00, despite having both liability and UM/UIM coverage.
Also, look for the following exclusion in your UM/UIM coverage:
“The Immunity Exclusion”:
EXAMPLE:You are riding in your insured vehicle with your family. You enter an intersection and are hit by a police car, ambulance, or fire truck responding to an emergency call. Everyone in your car is seriously injured.
However, these drivers are immune from liability under Ohio law if they are responding to an emergency, absent reckless or wanton driving.
Because the drivers and their employers are immune from liability, Ohio law says you can make a claim for your family’s injuries under the UM portion of your policy, unless there is a policy provision to the contrary.
Guess what – most policies contain a provision preventing you from making a UM claim.
The Supreme Court of Ohio has approved insurance policy language that UM benefits will not be paid unless the injured insured was “legally entitled to recover” against another motorist.
Since policemen, firemen and ambulance drivers and their employers have immunity when responding to emergency calls, a person injured by them is not legally entitled to recover against them and cannot bring a UM claim, even though they have paid for UM coverage.
It is almost certain that you will not find an insurance company who will sell you a policy without these exclusions. If this occurs, write/call your State Representative and State Senators and complain. Demand that they change Ohio law to prohibit these exclusions.
Many members of the legislature and the majority of the Supreme Court of Ohio are under the delusion that the average Ohio citizen can negotiate with their insurance company and get it to remove these exclusions. Let your State legislatures know that they will not.
LAFFERTY, GALLAGHER & SCOTT, LLC’S RATINGS FOR INSURANCE COMPANIES REGARDING UM/UIM COVERAGE
We have handled hundreds of UM/UIM claims during our combined 100 years of experience. Based upon this experience, we offer the following ratings regarding the major insurance companies that sell UM/UIM coverage in Ohio. Since almost all insurance companies use the same policy language, our ratings are based on how their claims representatives handle UM/UIM claims. We have considered the promptness, fairness and knowledge of the claims department in making our ratings. Our rating system goes from (1) to (10) with (1) being the worst and (10) being the best.
1) Allstate Insurance Company – This wasn’t even close. Contrary to their ads, you are not in good hands with Allstate.
2) Nationwide – this was a close call with State Farm.
3) State Farm
** Nationwide is not on your side and State Farm is not a good neighbor.
6) Motorists Mutual
10) Cincinnati Insurance Company
This report contains general legal and other information that we prepared to be helpful to consumers. It is NOT intended to be legal advice about your particular case or any other similar case, and you should NOT rely upon it in any manner. In fact, because some of the laws referred to can change or be interpreted differently by judicial decisions, it is all the more reason why it should be considered general information only.
Furthermore, each case is uniquely different. Past results do not guarantee future results, and results in one state or even one county may differ. We do not win all of our cases. In fact, no attorney or firm wins all of their cases. For ALL these reasons, we encourage you to consult with an experienced attorney or firm in your area. There is no attorney-client relationship between the reader and Lafferty, Gallagher & Scott, LLC in the absence of a formal fee agreement signed by attorney and client.