03
Dec
Underinsured and Uninsured Motorist Coverage - Why You Want It, Why You Need It!
Uninsured Motorist (UM) and Underinsured Motorist (UIM) coverage may be the most important and least expensive coverage you can purchase on your automobile insurance.
When purchasing automobile insurance, many individuals primary focus is liability coverage, the provision of their insurance policy that protects their own assets if they are at fault in an accident. However, your personal automobile insurance is a very powerful tool for protecting yourself against other drivers whom are either uninsured, or whose insurance coverage is inadequate to compensate you for damages that may be caused through their negligence. Uninsured Motorist (UM) and Underinsured Motorist (UIM) coverage is first-party coverage that provides a potential source of recovery for individuals whom are injured by a tortfeasor who is either uninsured or underinsured.
Pursuant to N.J.S.A. 17:28-1.1(e)(2) a tortfeasor’s vehicle is considered “uninsured” triggering a right to coverage in five situations: (1) when it is not covered by a policy of insurance on the date of the accident; (2) when the tortfeasor’s carrier disclaims coverage, this is likely to happen when the automobile was not being operating with its owner’s permission, when the insured fails to cooperate with the carrier or where the accident involved intentional conduct on the tortfeasor’s part; (3) when the tortfeasor’s carrier becomes insolvent or declares bankruptcy. (4) When the vehicle is a hit and run vehicle, a hit and run vehicle is a vehicle whose identity or operator’s identity cannot be ascertained. For an uninsured motorist claim to be asserted under this category, the plaintiff must show that he or she made reasonable efforts to ascertain the identity of the other driver or vehicle. Hit and run vehicles also include phantom vehicles, that is, vehicles that may force the plaintiff off the road or cause an accident in some other way without actually making contact with the plaintiff or his vehicle. (5) The final situation that may trigger uninsured motorist coverage is when the tortfeasor’s vehicle is covered by a “special” automobile policy. A “special” automobile policy is a policy that allows low income individuals to have Personal Injury Protection (PIP) for their medical bills if they are injured in an accident, however, it does not provide liability coverage for the compensation of individuals whom the “special” policy holder may injury through his or her negligence.
Pursuant to N.J.S.A 17.28-1.1(b) underinsured motorist coverage is first-part coverage that provides a source of compensation for an individual under his own insurance policy when the tortfeasor’s liability coverage is insufficient to cover the plaintiffs’ damages. To determine if the right to underinsured motorist benefits is triggered, it is necessary to compare the policy limits of the largest policy that the tortfeasor may look to for coverage, with the largest policy that may provide the plaintiff with underinsured motorist benefits. The tortfeasor may obtain coverage through his or her personal automobile policy, the policy of the vehicle in which he or she was operating, or through a general liability policy such as an umbrella policy. A plaintiff may obtain underinsured motorist benefits through his or her personal automobile policy, the policy of the vehicle in which her or she was operating or through the policy of a family member whom resides in the same household as the plaintiff.
As you can see, when selecting an automobile insurance policy, purchase as much uninsured and underinsured motorist coverage as you can afford. This will protect you and your family, as well as provide you with piece of mind while out on the road.