A bad accident could become a lot worse if the at-fault driver is one of the 18.4% of Alabamians who don’t have liability insurance. You may need money to repair or replace the car, pay medical expenses, and pay for lost time at work. If the other driver can’t pay, you’ll be very glad you have uninsured/under-insured motorist (UM/UIM) coverage on your auto policy. Check out our “Uninsured Motorist Coverage 101” article for more details on this important coverage and how it could affect you if involved in an accident with an uninsured driver.
What is Uninsured Coverage?
If your auto policy includes uninsured motorist coverage, your insurance company should pay for your damages up to the amount of the coverage. For example, if you have $25,000 in UM coverage and $30,000 in medical bills and other damages due to a collision involving an uninsured motorist who is at-fault, your insurance company pays up to $25,000 of covered claims, and you are only responsible for the remaining balance, instead of the full amount.
What is Under-Insured Coverage?
If your policy includes under insured motorist coverage, it kicks in after the other driver’s insurance company has paid its policy limit. For example, say the other driver had the minimum $25,000 policy, you had under-insured coverage of $25,000, and your damages totaled $50,000, The other driver’s company would pay the first $25,000, your company would pay the balance, and you would owe nothing.
If you do not have UM/UIM coverage, you can attempt to collect from the at-fault driver. However, in most cases, drivers without insurance have very few assets, making it likely that you won’t collect
How Do I Get Uninsured/Under-Insured Coverage?
Alabama requires insurance agents to offer UM/UIM coverage at the time you purchase your auto policy. Generally, the coverage amount matches the amount of your bodily injury coverage. Under Alabama law, if you decline this coverage or opt for a lesser amount, you must sign a waiver before the policy will be issued.
Maximum available coverage can exceed $1 million depending on the insurance company.
How Much Does Uninsured/Under-Insured Coverage Cost
Generally, you can expect to pay an additional five percent of your annual auto insurance premium for UM/UIM coverage. For example, if you paid $800 annually for your policy, the UM/UIM coverage would cost an extra $40. You probably would consider that a bargain, if an at-fault driver ran into your car.
Who is Covered by Uninsured/Under-Insured Insurance?
In addition to you, UM/UIM insurance typically covers your passengers, permissive drivers of your vehicles, and household members including resident relatives. Be sure to read your policy carefully and ask your agent if you have any questions regarding included or excluded parties.
Can the Insurance Company Refuse to Pay My Uninsured/Under-Insured Claim?
Yes. In some circumstances, insurance companies delay or refuse to make payments. These cases can be complicated requiring you to get help from an experienced accident injury attorney. Here are some potential problems”
- Determining which insurance company has the primary responsibility to pay and which company is secondary, especially in multi-vehicle accidents.
- Determining fault among the drivers.
- Determining if you can benefit from “stacking” coverage amounts if your policy covers multiple vehicles if you have multiple policies.
- Determining whether you can claim under your employer’s fleet policy and your personal auto policy
If you are having difficulty collecting your uninsured or under-insured claim from your insurance company, you should contact our experienced auto insurance attorneys as soon as possible.
When you need legal help following an auto accident, it pays to contact an experienced lawyer like those at Clay, Massey & Associates. We offer FREE initial consultations, and are available for hospital or home visits if you are unable to come to us. Just give us a call at 251-433-1000 or click the Live Chat link on our site to get started!