Don't Make This $900,000 Mistake

By Ben Glass, Esquire

Benjamin W. Glass and Associates

. https://www.benglasslaw.com/

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Don't Make This $900,000 Mistake

Important Car Insurance Policy Information

The start of the year is a great time to do a checkup on your car insurance policy.

Do you understand what your policy does and does not cover? Do you have enough coverage? Do you have enough of the “unobvious” coverage?

Most people understand the concept of buying car insurance to protect their own assets if they carelessly hurt someone else or to get their own car repaired if it is damaged.

But what happens if you are hit and injured by someone who has no insurance at all? Think it can't happen? Think again.

First, there are some people who have simply let their insurance lapse. In this time of severe economic hardship, the car insurance bill is sometimes the bill that doesn't get paid. Car insurance companies are quick to cancel when you don't pay.

Second, Virginia is one of those few states where it is perfectly legal to drive without car insurance. When you register a car in Virginia, you have a choice. You can either buy car insurance or pay a $500 fee to the uninsured motorist fund. When someone pays the $500 fee, they are legally allowed to drive without insurance.

With today's out-of-control medical costs, even a moderate injury from a car accident can set you back tens of thousands of dollars.

The way that you protect yourself is by buying “uninsured” and “underinsured” motorist insurance coverage. Buy lots of it. It is cheap.

Recently, a young lady was severely injured in a car accident. She had been smart enough to buy $100,000 of uninsured motorist coverage, but it was not enough to cover her injuries. What she later discovered is that for an additional premium of $34 per year, she could have had $1 million of coverage. Had she known at the time how cheap this additional insurance was, she would have been compensated properly for her injuries.

This type of coverage will protect you if the person who causes the accident either has no car insurance or has less insurance than you do. (Thus, the use of the term “underinsurance.”) In either situation, your own insurance company will step in to provide you with additional coverage to pay for your injuries, medical bills, lost wages and any pain and suffering damages you are entitled to. It will also provide coverage for future medical bills.

Two warnings Some insurance agents don't understand the importance of buying lots of uninsured motorist coverage and, thus, don't explain this concept well.

Second, your agent may attempt to sell you an “umbrella” policy when you discuss this with them. An umbrella policy is good to have, but most umbrella policies do not provide uninsured motorist coverage. So even if you have a lot of umbrella coverage, you still may not be adequately insured if someone who is driving without car insurance hits you.