Why You Need Uninsured and Underinsured Motorist Coverage.

Not all my practice is devoted to the representation of victims of medical malpractice.  I also represent people who suffer serious injuries in automobile accidents.  These cases often involve uninsured or underinsured motorist issues.  Of course, by the time I see the client and we discuss insurance issues, they either had uninsured and underinsured motorist coverage at the time of the accident or they did not.  It is too late to get it by the time they are sitting in my office.


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Let’s get some of the basics out of the way.

Uninsured motorist coverage (UM) and underinsured motorist coverage (UIM) are different but similar.  Uninsured motorist coverage (UM) applies if you are in an accident and the other driver does not have an automobile liability policy in the minimum limits required by the State of Arizona.  It also applies if you are in an accident with a hit and run driver.  For policies issued before June 30, 2020 Arizona’s minimum limits are $15,000 per person and $30,000 per accident for bodily injury.  For policies issued after June 30, 2020, the minimum limits are $25,000 per person and $50,000 per accident for bodily injury.  If the other driver has such a policy, he is not an uninsured motorist even if the policy limits are not enough to pay for all the damages he caused.

By contrast, an underinsured motorist is a person who has automobile liability insurance with at least the limits required by the State of Arizona but whose limits are not sufficient to pay for all the injuries he caused.  It does not matter how big his policy is.  If it is not big enough to pay for all the damages, he is an underinsured motorist.  Underinsurance is measured by comparing the amount of the damages to the amount of the policy.  For example, if a motorist has a $1,000,000 liability policy limit but causes damages to you in the amount of $1,050,000, he is an underinsured motorist for the amount by which your injuries exceed his liability limits.  In my little example here, you can collect his million dollar limit and then recover your additional $50,000 in damages from your UIM coverage, if your UIM limits are that high.

A person cannot be both an uninsured motorist and an underinsured motorist.  He can be one or the other but not both.

A.R.S. Section 20-259.01 requires an insurer writing an automobile liability policy to make a written offer to the customer of both uninsured motorist coverage and underinsured motorist coverage for limits at least as much as the policy’s liability limits.  This means that, if you buy a policy with a $500,000 single limit of liability coverage, the insurance company must offer you $500,000 worth of uninsured and underinsured motorist coverage.  You don’t have to buy it in that amount, or at all, but the insurance company must offer it to you in writing.  There is no requirement to offer uninsured or underinsured motorist coverage when selling an umbrella policy.

So why buy these coverages at all?  If you decide to buy, how much should you get?

When I talk to a new client about their automobile accident case, one of the questions I always ask is whether they had UM and UIM coverage at the time of the accident, and, if so, in what amount.  I often find that the client has either refused the coverage or purchased it in an amount less than his or her automobile liability limits.  In my opinion, this is foolish.

UM and UIM are the only coverages that pay you and your passengers, if you are in an automobile accident.  If the accident is your fault, the liability portion of your policy pays the other people in the accident.  While that helps you by protecting your assets, if the accident was your fault, it does not put any money in your pocket.  On the other hand, if the accident was not your fault and you do not have either UM or UIM coverage, you are at the mercy of the other driver.  If the other driver has no insurance or only a small policy, you and your passengers may be out of luck.  On the other hand, if you have UM and UIM coverages, you will be able to make a claim under those coverages for the amount of your injuries up to the UM or UIM policy limits.

It is estimated that almost 12% of the drivers on the road in Arizona are uninsured.  Many, many of the rest will have only small policies.

For all these reasons, I recommend buying UM and UIM coverages in the biggest amount the insurance company will sell you.  The coverages are less expensive than liability coverage and are well-worth the money you spend to buy them.  In fact, I recommend buying the largest liability policy you can afford just so you can force the insurance company to offer you more UM and UIM coverage.

If you are in an accident in which you or a passenger suffer any serious injury as a result of the fault of another driver, I can virtually guarantee you that the other driver will be either uninsured or will meet Arizona’s definition of underinsured.  You need to protect yourself and your passengers and family from these people.  Buy that uninsured and underinsured coverage when it is offered to you and buy as much of it as you are allowed.




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