Many of my clients who are involved in an accident bring in their insurance policy for my review. Here is what I tell them.
1. Liability insurance protects you if you are found to be at fault, and the person who you hit has car damage, or is injured. Liability insurance has separate limits for property damage, and bodily injury. If you have a lot of assets, a house, investments, and savings, get at least $100,000 of bodily injury coverage, and $50,000 of property damge coverage. You should consider purchasing an excess policy (sometimes called an umbrella), to protect you if the claim turns out to be huge. I recommend at least a 1 million dollar umbrella for homeowners. Excess coverage is surprisingly cheap compared to the underlying policy. Remember, once an accident occurs, it's too late to buy insurance to protect you for that event.
2. Uninsured and Underinsured motorist, is a very important part of the auto insurance policy, because it protects you, and your family members who live with you when the other guy (or gal) is at fault and injures you. If the other party is not insured (or has lower bodily injury liability insurance limits than you have on your policy --meaning he is underinsured), the uninsured motorist coverage or underinsurance (UM/UIM) will protect you if you or a resident family member become injured.
Here's an example: You are rear-ended with your wife in the car. Your wife had a bad back before, but this new car accident aggravates the injury, and she soon learns that she will need to fix a herniated (ruptured) disc in her back. In this example, assume that the responsible driver has only a minimum policy of $15,000, but you smartly purchased $250,000 of UM coverage. The other party pays you $15,000 when we file a claim against them.
But you're not done yet.
Your wife can now claim underinsurance against your own policy for another $235,000, which is the difference between your $250,000 UM coverage and the other driver's $15,000.00. This UM coverage is surprisingly cheap to increase, and I strongly recommend that you have at least $250,000 of UM/UIM coverage. Here's an interesting point that most people don't understand about UM coverage. It even protects you when you are a pedestrian, jogging, on a bicycle, or even riding a skateboard. It often pays when your health insurance will not,
so keep it handy in your insurance arsenal. I have settled thousands of uninsured motorist cases, and can help you through the process. Call me at (818) 601-5620 for a free consultation on any uninsured or underinsured accident case.
3. Medical Payments: This is typically $1,000 to $10,000 of coverage for medical expenses. If you have health insurance, then you might not need it, but it is quite cheap to have, and it will pay for reasonable care, without you having to
pay a deductible or co-pay in most cases.
If you have any questions about your insurance policy, call John Neustadt at (818) 601-5620 and he will be happy to counsel you at no charge to make sure you are not missing an important coverage.