Uninsured and Underinsured Motorist Insurance

How to Protect Your Family from Financial Ruin

One of the saddest circumstances I deal with frequently is interviewing a new potential client who has been severely injured through the apparent negligence of another driver and then informing the potential client that he doesn’t need a lawyer because the other insurance limits are so low, he can likely obtain them by himself.

When people buy auto insurance, they rely on their insurance broker to protect them. Unfortunately, many brokers fail to adequately explain each coverage they sell. If their client is

cost-conscious, they suggest they can save a few dollars by waiving uninsured or underinsured motorist coverage. This is always a big mistake.

While someone can waive this coverage, the California legislature requires a written waiver that clearly explains the insurance’s purpose and its consequences.

Uninsured motorist coverage protects a car driver if the negligent party in the accident has no insurance. This happens much more frequently in the past few years, and many sources estimate the number of uninsured drivers to be as much as 25% of all drivers.

Uninsured motorist insurance protects you and your family if the other party is uninsured up to whatever limits you have of uninsured motorist coverage.

So, if you are in a collision with an uninsured driver and you (or anyone else in your car) suffer serious injuries, you can recover from your own uninsured motorist coverage.

If you have a severe injury with damages of $100,000, you can recover up to $100,000 from your own insurance if you had limits that high on your uninsured motorist coverage.

Most companies will not sell uninsured motorist coverage for limits over your liability coverage. So, if you have a $50,000/$100,000 liability, you can only buy $50,000/$100,000 UM coverage.

Underinsured Motorist coverage is similar to uninsured motorist coverage, except it will pay you up to your limits if the other party has auto insurance. Still, his limits are not enough to cover your injuries.

For example, the at-fault driver has liability limits of $50,000/$100,000. That means the most injured party can recover from him is $50,000. The most everyone in your car can recover from the injured party is $100,000.

If you carry a $250,000/$500,000 uninsured motorist coverage, after you collect the first $50,000 from the other driver, you can recover another $200,000 from your own uninsured motorist carrier.

Traumatic injuries can be costly. Every day and night at UCD Medical Center may cost over $25,000.

For this reason, I suggest that my clients obtain the highest UM insurance coverage they can afford. For most people, I suggest a minimum of a $100,000/$300,000 policy.

  • If your family earnings are over $75,000 yearly, I believe  $250,000/$500,000  is the minimum you should carry.
  • If family earnings are over $125,000 yearly, I suggest a  $500,000/ $1,000,000 policy.

Surprisingly, the premium on purchasing these increased limits is not much more than you will pay for the minimum limits.

You may also want to include a personal umbrella policy and your underlying Uninsured Motorist Insurance. This is NOT a typical Umbrella. This specialized type of umbrella extends your Uninsured Motorist coverage up to 1 million or 2 million of whatever limits you choose. A regular umbrella does not protect you in this way.

A few insurance companies sell personal umbrella policies, but you will need to search around or feel free to call me for a recommendation.

Sacramento Uninsured and Underinsured Motorist Lawyer

I’m Ed Smith, and I’ve been a Sacramento Uninsured and Underinsured Motorist Lawyer since 1982. My website, AutoAccident.com, is the primary vehicular accident website in California. Call me anytime at 916-921-6400 in Sacramento for friendly, free advice.

You may also find more about my law firm on Yelp or Avvo.

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