Auto Insurance Policies: A Crash Course

If you are involved in an automobile collision, it is important to know not only what limits of liability insurance the at-fault driver has, but also what coverages you have. Many clients walk into a lawyer’s office having been involved in collisions with uninsured or underinsured motorists. In these situations, it is important that the client carries his or her own uninsured motorist (UM) or underinsured motorist (UIM) coverage. Unfortunately, people sometimes believe that they have this important coverage because they purchased what they believe is “full coverage,” when, in fact, they have not purchased UM or UIM coverage.

Uninsured motorist coverage is purchased for self-protection when a collision occurs at the fault of someone who does not have the minimum liability coverage required by state law ($15,000 in Arizona). Underinsured motorist coverage is for self-protection when a person who has caused the collision has inadequate coverage to compensate the client for his or her injuries. It is important to note that neither underinsured nor uninsured motorist coverage provides coverage for property damage.

The procedures for offering and rejecting uninsured and underinsured motorist coverage is set forth in Arizona Revised Statute d20-259.01. Essentially, insurance companies must offer to sell such coverages up to the same limits being purchased for liability coverage. If the offer is rejected, it must be done so in writing. If an insurance company fails to follow the procedures set forth in the law, UM and UIM coverage may exist even when they have not been purchased.

Another type of coverage too often overlooked is medical payments coverage, which provides coverage for medical bills – usually in increments of $1,000- regardless of fault. It appears that, too often, clients are talked out of medical pay coverage because they already have health insurance. However, medical pay coverage can be beneficial in providing more options for health care and treatment for injuries.

Mintz Law Firm car accident attorneys encourage and recommend that clients review their own auto policies with their agents and purchase adequate amounts of uninsured, underinsured and medical payments coverage. How true the old saying: “Better safe than sorry.”