Auto Insurance. Understanding Some Basics.

Auto Insurance, Accidents and injuries.

Auto Insurance

Auto insurance presents a necessary evil.  Driving without it is folly.

Driving a rolling two-ton metal box, disaster happens in a split second.  Cars pose a rolling risk.

Excuses for shirking off insurance include “I always drive responsibly …  if I get in an accident the other guy’s insurance will pay.”

Surprisingly, many accidents happen where neither party is insured.  Then, the faultless driver is stuck with no car, no way to pay medical bills if hurt, and huge repair bills.  Worse, car loans don’t go away just because the vehicle is wreckage.

Basic Auto Insurance Coverage

Basic auto insurance provisions can address the above problems:

  • Medical Payments:  The first thing to understand is that your own auto insurance policy is the primary coverage for your own hospital bills and other medical expenses.  Medical payments provisions pay accident related medical bills.  “No-fault” states often have a “PIP” or personal injury provision to pay certain medical bills.  Even there, though, the medical payments can supplement medical bills for the operator and passengers.  This coverage is relatively inexpensive.  Don’t let the agent talk you out of buying this.
  • Uninsured Coverage:  If you are involved in an accident in which the other operator has no insurance, this provision is available to compensate for your own bodily injuries.
  • Underinsured Provision:  Suppose you are seriously injured in a motor vehicle accident and the other guy has insurance, but only the bare minimum.  After you receive the total policy limits from that liable driver’s insurance company, then your own underinsured coverage is available to compensate for your bodily injuries over the other driver’s minimum.

These are bare minimums.  There are many other provisions beyond this summary.

Legal Defense

One of the things included with the price of auto insurance is a legal defense.  At some point after an accident you receive court papers, the other guy sues you.  Should the other guy bring suit against you your own insurance company has a duty to legally defend you.

Call the agent immediately if sued because court papers have time sensitive deadlines.  Under your own policy you have a duty to cooperate with your own insurer.  This starts with putting legal papers in the hands of your own insurance company without delay.

Your insurance company’s job is to defend you up to the limits of your policy.  Should the other driver win a court judgment in excess of your coverage, payment is your personal responsibility.  Purchasing adequate coverage to protect all assets is vital.  If there’s potential for a judgment against you over your coverage, then consult with and potentially retain your own attorney to defend you alongside the insurance company’s defense team for your own protection.

No Insurance Auto Accidents

When accidents occur between drivers neither of whom have insurance, suing the other guy is not always a great option.  If the other guy was irresponsible enough not to have insurance, it’s likely they have nothing to protect and a lawsuit would be pointless.  A lawsuit against the uninsured other guy takes time, energy and court costs.  Even if you win, there’s no point if the other guy has no assets or minimum assets protected by homestead or other legal exemptions.

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About Andrew Myers

Attorney Myers is a member of the American Association For Justice, Massachusetts Academy of Trial Attorneys, New Hampshire Association For Justice, National Association of Consumer Bankruptcy Attorneys & Rotary International. Legal services provided in Massachusetts (MA) and New Hampsire (NH).

Discuss: “Auto Insurance. Understanding Some Basics.”

  1. July 1, 2013 at 4:17 pm #

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