Archive for the ‘accident’ Tag

UM: Benefits Beyond Medical Bills   Leave a comment

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At the break in a class I overheard a student say, “My husband is in the military, so we don’t need uninsured motorist (UM) coverage.” The same comment could be said by someone who had PIP coverage, auto medical payments coverage, health insurance, disability insurance, Medicare, or even workers’ compensation coverage.

Clearly, the benefits provided by the military, PIP, auto medical payments, disability insurance, and workers’ compensation can be substantial. Even as good as those benefits are, however, there are expenses not covered under those policies that would be covered by UM. Remember, UM pays what the insured is legally entitled to recover from the at-fault party. Often, monetary damages awarded by a court include things that none of the earlier referenced policies (or military benefits) will cover.

Let’s take a look at this issue by way of example and see what the benefits of UM coverage are, beyond just reimbursement for medical bills.

Suppose Bill is involved in a hit-and-run auto accident and is seriously hurt by the at-fault party. He is protected by a personal auto policy (PAP) with $50,000 of PIP (he increased the $10,000 basic limit to this higher amount after seeing the small additional premium charge) and $5,000 of auto medical payments coverage. His auto policy includes $250,000 of UM coverage and his personal umbrella includes $1 million of UM. Bill has no disability income policy. Additionally, he is covered by a health insurance policy provided by his employer.

As a result of the accident the following expenses and losses were incurred by Bill:

  • $75,000 for prior medical bills.
  • $175,000 for future medical bills.
  • $20,000 for prior lost wages.
  • $300,000 for future lost wages.
  • $1,000 for a wheelchair since Bill is unable to walk now.
  • $10,000 for future wheelchairs.
  • $30,000 for a special van to transport Bill and his wheel chair.
  • $90,000 for future vans.
  • $20,000 to retrofit the house to accommodate the wheel chair.
  • $25,000 for a yard service for Bill’s remaining life expectancy, since he is unable to cut the yard now.
  • $100,000 for future pain and suffering.
  • $100,000 for the loss of “family comfort” with his wife.
  • $100,000 for the loss of the ability to coach youth softball.
  • $200,000 for future loss of the enjoyment of life.

Looking at the insurance that Bill has (disregarding the UM for now) what is seen is that the PIP and auto medical payments coverage are quickly exhausted. Bill can fall back on his health insurance, but keep in mind that he will likely incur a deductible plus a co-pay each year. Once Bill’s PIP is exhausted, his wage-loss protection is gone and with no disability income policy he is “up the creek.”

Suppose, however, that the accident happened to be work related and thus covered by worker’s compensation. In such case, Bill’s medical expenses would be fully covered, subject to the provisions of the workers’ compensation law. Bill’s lost wages would be paid, typically (in Florida) at 66.67 percent of his wages. The time period for which workers’ compensation will respond for lost wages varies from two years to a lifetime, depending on the type of disability. Remember, too, wage loss benefits are subject to a maximum per week, which in Florida is around $850 per week. The wage loss benefits paid to Bill by workers’ compensation would not fully replace his salary.

With or without workers’ compensation coverage, consider the monies awarded to Bill for which he has no coverage, except under UM. The excess medical expenses, lost wages, wheelchair, van, house modifications, yard service, pain and suffering, loss of family comfort, and all the other damages listed above would be covered by UM.

Of course UM isn’t always an inexpensive coverage, but when the cost is compared to what most folks spend on cable TV, cellular service, a country club membership, or eating out for dinner twice a month, the cost for UM is probably the lowest listed.

Even if someone is in the military, is retired, and/or has “a lot of other insurance,” the protection provided by uninsured motorist coverage is very valuable. Don’t be so quick to reject this valuable coverage.

” Our blogs are for general education and information only and may not represent your unique needs. Coverage will vary. Please contact your agent to verify your specific policy terms and conditions.”

Courtesy of FAIA, Authored by David Thompson, CPCU, AAI, API 

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I had an accident but I didn’t get a ticket so the other guy is at fault, Right?   Leave a comment

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Florida is a “Comparative negligence” State

Florida uses a form of comparative negligence (or your percentage of fault compared to the other party’s). This allows you to seek compensation even if you’re deemed only partially at fault. Since Florida uses comparative negligence, you can seek damages in proportion to your degree of responsibility for the crash.

For example, if a speeding driver rear-ends you after you suddenly changed lanes, it may be determined that both of you bear a degree of fault. If the other driver is found to be 60 percent responsible and you’re held 40 percent responsible, you may seek up to 60 percent of the settlement from the other driver’s insurer.

What “At Fault” Means 

It should come as no surprise that “at fault” literally means the person that caused the accident, or the one whose fault it is. Basically a person that is considered the catalyst for the accident is most likely to be considered “at fault”. There are other classifications of accidents, such as “no fault” and “partial fault”. Often times it can be difficult to ascertain who is at fault, and liability will be assessed to both drivers. In most cases, the person considered at fault will be the one that has performed an illegal, reckless, careless or irresponsible action while driving their vehicle, thus causing other vehicles to react to their actions, resulting in an accident.

What are the Ramifications of “At Fault”? 

Drivers that are considered at fault will find their insurance rates will increase, especially if there has been considerable damage to other vehicles. In addition, some insurance providers will drop drivers if they have too many at fault accidents. Furthermore, negligent drivers may be forced to pay for medical expenses, adding even more cost to their insurance companies. This can be particularly devastating if several cars, and multiple people, are involved. Property damage can also be tacked on to this as well. Insurance rates are not the only ramification of being at fault for an auto accident. Florida will assign points for every incident on driver’s licenses if you get into too many accidents, which in turn can further raise insurance rates.

What to do after an accident.

Get information from all of the vehicles involved. Get the other drivers names, addresses, and telephone numbers. Record the makes and models of the other vehicles, their insurance company information, and their vehicle identification number. The more information that you can get the better but, the mentioned information is a must. Do not ever try to handle the accident without your insurance company. In other words, do not ever let another driver talk you into handling the situation amongst yourselves. Even if they admit guilt of the accident and tell you that they would rather not have insurance companies involved for fear of future insurance rates going up, don’t go for it. Even if the person seems like the nicest person in the world, don’t make this mistake. There have been many cases where this has happened, then a few days later the innocent driver who was not at fault is informed that the other driver is suing them. Suddenly that other driver does not believe that the accident was their fault anymore and reported the accident to their insurance company. This kind of situation will leave you in a bad situation so do not fall for something like this no matter what! 

You will then want to contact your insurance company right away and let them know what happened. Give them all the details of the accident and let them know that the accident was not your fault. If you can call them while the police are present it may be even better as the police may be able to give them information that you can’t.

“Our blogs are for general education and information only and may not represent your unique needs. Coverages will vary. Please contact your insurance agent to verify your specific policy terms and conditions.”