PROTECT YOURSELF FROM UNINSURED MOTORISTS

It is very important to have liability insurance to protect yourself from liability arising from your own negligence. However, there is another, very important aspect to protecting yourself, and that is protecting yourself from financial losses caused by the negligence of uninsured motorists.

Many drivers have insurance to protect their vehicles. "Comprehensive" and "collision" insurance coverage will reimburse an owner for damage to or loss of a vehicle due to an auto accident, theft, hail, or just about any other peril. These types of coverages are quite popular because most lenders require that the owner have these types of coverage before a loan is made, but these coverages are limited to damage to the insured car.

However, the loss of or damage to a motor vehicle may be one of the most insignificant losses suffered by a person injured in an automobile accident since personal injuries and losses (such as medical bills) can easily exceed the value of a car. Other possible losses include physical therapy expenses, travel expenses incurred in obtaining medical care, lost income, prescription costs, home health care, and domestic services expenses (such as hiring someone to cook or clean while the injured person is incapacitated).

A negligent driver is also liable for other damages suffered by an injured person, even though the other damages do not result directly in an out-of-pocket loss for the injured person. For example, a person injured by the negligence of another is entitled to reasonable compensation for pain, suffering, loss of enjoyment of life, and disfigurement. These types of "nonpecuniary" losses can add up to tens or even hundreds of thousands of dollars.

Unfortunately, many drivers do not purchase insurance which protects them from these potentially devastating financial losses. These drivers who do not purchase such insurance are, whether they realize it or not, relying upon others to have adequate liability insurance.

The type of insurance coverage which protects against one's own damages and losses is known as "uninsured motorist" or "UM" coverage. It is, in effect, a purchase of liability insurance for the negligent person who injures the insured while the insured is operating his vehicle.

Consider the situation in which Ned Negligent drives through a red light and strikes Gary Gooddriver's car, and a jury determines that Gary Gooddriver is entitled to $50,000 for personal injuries and $5,000 for injuries to his car. If Ned Negligent has no liability insurance, Gary Gooddriver will not actually collect any compensation from Ned Negligent unless Ned is able to pay the $55,000 judgment out of his own assets (which would be very unlikely).

However, if Gary had purchased UM coverage, he would be entitled to collect the $50,000 of personal injuries from his own insurer (assuming he had at least $50,000 of UM coverage). Since UM coverage does not cover property damage, Gary could collect $5,000 from his own insurer only if he had collision coverage; otherwise, Gary would actually collect the $5,000 from Ned only if Ned were able to pay it out of his own assets.

Now assume the same facts of the accident, that Gary Gooddriver had no UM coverage, and that Ned Negligent has the statutory minimum liability insurance. Under these facts, Ned's insurance will pay $10,000 for Gary's personal injuries and $5,000 for the damages to Gary's car, but Gary will not receive any further compensation from Ned Negligent unless Ned is able to pay the remaining $40,000 out of his own assets.

Now assume the same facts of the accident, that Gary Gooddriver has $100,000 of UM coverage, and that Ned Negligent has the statutory minimum liability insurance. Under these facts, Ned's insurance will pay $10,000 for Gary's personal injuries and $5,000 for the damages to Gary's car, and the remaining $40,000 in personal injuries will be covered by Gary's UM coverage.

As these examples make clear, having UM coverage is extremely important. Counting on others to have adequate liability insurance is a risk that too many drivers unwittingly undertake, but it is a risk which can be avoided with the addition of ample UM coverage.

Fortunately, as in the case of liability insurance, increasing the amount of UM coverage is relatively inexpensive, compared to the cost of minimal coverage. Call your auto insurance agent today to discuss whether you are protected with adequate UM coverage.

This "Legal Update" is provided as a public service of Garvin, Agee, Carlton & Mashburn. It is intended to provide general information about the law, and is not a substitute for the advice of an attorney as to specific facts and circumstances. Anyone having any questions regarding the matter contained in this article, or needing advice as to specific facts or circumstances, should contact an attorney practicing in the appropriate area of the law.

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