By law, all drivers in California are required to have car insurance when they get on the road.
The minimum requirements in for car insurance in California are:
• $15,000 for injury or death to one person
• $30,000 for injury or death to more than one person
• $5,000 for property damage
While $15,000 is certainly a lot of money, car accidents and injuries can quickly cover this amount. While this is a generalization, the average settlement amount for a car accident is $21,000.
Depending on the severity of the injury, medical bills alone can easily total over $100,000—and if the at-fault driver only has a minimum policy or isn’t insured at all—you may recover nothing unless you have specific types of coverage. As of 2015, it was estimated that 15.2% of drivers in California were uninsured.
The following are three different types of coverages you should look into getting to make sure that you’re covered even when the other driver isn’t.
Uninsured Motorist Coverage (UMC) / Underinsured Motorist Coverage (UIM)
UMC/UIM coverage is an optional coverage that the state requires your auto insurance to offer you. If you choose not to have this type of coverage, you must sign a waiver stating that you declined it. UMC/UIM covers when another driver is at fault and either:
• Has no insurance, or
• Doesn’t have enough insurance to cover the injured party’s damages
While this coverage isn’t mandatory in California, we highly recommend it. California has the most uninsured drivers of any state. Usually, uninsured drivers have fewer assets and less income than drivers with insurance. This means that if you’re injured in a car accident by an uninsured or underinsured driver, your recovery will be limited or be nothing at all.
UMC coverage has two different types: bodily injury (UMBI) and property damage (UMPD). UMBI pays for injuries to you and your passengers when there is an uninsured driver at fault. The limits are the same as your liability coverage. UMPD pays for damage to your car from an accident with an uninsured driver who is at fault. The limit is $3,500. This coverage may not be necessary if you have collision coverage.
UIM coverage makes up the difference between the at-fault driver’s insurance policy and your own. To recover the difference, you must have higher policy limits.
For example, if the at-fault party has a minimum policy of $15,000, and your damages come to a total of $100,000, if you don’t have UIM coverage then you will only receive $15,000. You have the option to sue the person individually to seek the remainder, but it is highly unlikely they have any assets to go after and so this wouldn’t be pursued. However, if you have a policy of $100,000/$300,000, then you will be able to get the original $15,000 and file a UIM claim for the difference of $85,000 with your own insurer. This is why we recommend not only getting UMC/UIM coverage but also making sure that your policy limits are higher.
Medical Payments Coverage (MedPay)
MedPay is a type of coverage that is designed to pay immediate medical treatment or funeral costs. This type of coverage is effective immediately and you don’t need to wait. MedPay will cover not only the driver but also passengers and family members in the insured car no matter who is at fault.
An additional benefit of MedPay is that it follows the policyholder even when they aren’t driving. What this means is that if you’re riding a bike, walking, in a friend’s car, or out of state, you will still have coverage.
There are no deductibles or co-pays with MedPay coverage. The policy limits are usually much lower than your liability coverage because the idea behind it is to cover emergency medical costs associated with the car accident.
If MedPay is used, your insurer will usually be reimbursed out of the total settlement amount. Although the limits are low, this is a good extra safeguard that helps to offset medical bills and costs in an accident.
As we said earlier, it’s always a good idea to look at raising your base liability coverage limits to fully protect yourself. We recommend $100,000/$300,000 policy simply because the cost of a car accident can go up very quickly.
If you’ve been in an accident with an uninsured driver, we still may be able to help. We offer free case evaluations and we would be happy to review your case with you. We can be reached at (916) 619-5452, we have a form online, and can be reached by email at info@hanecaklaw.com
