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Uninsured Motorist Claims (UM claims) refers to insurance you purchase as part of your automobile insurance coverage that will compensate you if a person that has no insurance injures you in an accident. Supplemental Underinsured Motorist Claims (SUM claims), refers to insurance coverage you purchase as part of your automobile insurance coverage that will compensate you if you’re injured in a motor vehicle accident by a person that does not have enough liability insurance coverage to adequately compensate you for your injuries.
The UM/SUM insurance you purchase as part of your automobile coverage will step in the place of the negligent party and compensate you for your losses. This insurance will only apply if the other party was negligent. If the accident was your fault you cannot make a UM/SUM claim. If you are partially at fault for your accident, you can make a claim and receive compensation for the other person’s proportionate share of fault regarding the accident.
There may be several instances where UM coverage will be triggered in order
to compensate you for injuries suffered in a car accident. Every person must maintain automobile liability insurance on their vehicles in the amount of at least $25,000. However, as we all know, not everyone follows the law and there are many instances where car accident victims suffer injuries caused by a person operating a vehicle without insurance.
In such a case, you can present a UM Claim to your insurance company for compensation for your injuries. Another instance where UM coverage applies is in a hit and run accident. If you are a passenger in someone’s car that does not have insurance you can make a UM claim against your own household vehicle. A UM claim should be made as soon as possible as certain deadlines will apply.
The insurance company will require proof that the offending driver was uninsured at the time of the accident or fled the scene of the accident prior to accepting the claim. In a hit and run situation proof of contact with another car will be required to pursue a UM claim. Once the proof is provided to the carrier, you can pursue recovery from your own carrier up to the limits of your UM coverage. In New York, everyone must have at least $25,000 of UM coverage. But most insurance companies offer policies up to $1,000,000 for an extra cost. However, it must be in place prior to your accident to apply.
You initiate your UM claim by providing written notice to your insurance carrier you were injured in an accident with an uninsured driver or a driver that fled the scene. The carrier will inform you if they are accepting the claim or require more proof before accepting the claim. Once the adequate proof has been received by the carrier, they will assign an adjuster to handle the claim. The adjuster will gather information such as a police accident report, witness statements, medical records and lost wage records. Once the adjuster has the relevant information they will evaluate the claim. If the adjuster feels that the other party is at fault or at least partially at fault and that you have sustained a serious injury, they will make an offer to settle. You can either accept the offer or demand more money. If you cannot agree upon an amount of money that is fair, you can request arbitration with the American Arbitration Association.
Litigating a UM claim against your own insurance carrier in an arbitration can be tricky. The process is similar to a trial. Prior to the arbitration, you must submit to discovery, a deposition and medical exam and provide medical records and other documentation to support your case. Once all of that is complete there will be a hearing before an arbitrator. The hearing will be similar to a mini-trial. There will be opening statements, testimony, presentation of evidence and closing statements.
I would strongly recommend hiring a qualified personal injury attorney to pursue a UM claim. The insurance companies have made filing for the claim very complicated and full of pitfalls. Further, litigating a case at arbitration takes years of training and experience. It can be done pro se, but is not advisable.
Pursuing an SUM claim is very similar to pursuing a UM claim with one
exception. Since a SUM claim is one you make when the offending party is underinsured, before pursuing the claim with your carrier, you must first resolve the underlying claim for the full limit of the offending party’s insurance. For example, if the person that caused your injury has only a $25,000 policy limit and your injuries exceed that amount, you must receive the full amount before you qualify to pursue your SUM claim. If you accept anything less than the full amount you will be barred from pursuing a SUM claim. You also should provide notice to your carrier as soon as possible that you are planning to pursue a SUM claim. Therefore, as soon as you learn that the limits of the offending vehicle are underinsured, you should let your carrier know that you will be pursing a SUM claim.
Further, you must provide your own carrier notice of your intent to settle your claim against the responsible party prior to accepting the settlement offer and obtain your carrier’s written consent to settle the claim. The purpose of this is so the carrier can investigate whether the responsible party may have additional insurance that may cover the claim. An insurance carrier cannot unreasonably withhold consent to settle. Once notice is provided to them of your intent to settle, they have thirty days to provide consent or come forward with their reasons for withholding their consent. If they do neither, you can settle your claim with the offending party and pursue your SUM claim.
Once again, I must caution that pursuing this type of claim is complicated and full of pitfalls. It is advisable that you consult with a personal injury attorney prior to pursuing an SUM claim.
Steven Palermo is the managing partner for Palermo Law, Long Island’s Personal Injury Law Firm. He has been helping people receive compensation for their injuries for over 21 years. He focuses on cases involving car accidents, truck accidents, construction accidents and slip and fall injuries.
His book The Ultimate Guide to Handling New York Car Accident Claims details the ins and outs of a car accident claim in a simple, easy-to-read manner.
By New York State law, every insurance carrier must offer Supplemental Uninsured Motorist (SUM) Coverage. This type of coverage is extremely important if you’re ever seriously injured by a driver who is underinsured, uninsured, driving a stolen vehicle or commits a hit and run against you. If the at-fault driver is uninsured or underinsured and has little-to-no assets, your compensation comes from your Supplemental Uninsured Motorist coverage. If the at-fault driver is insured, their Bodily Injury Liability (BIL) coverage will compensate for your medical costs, lost wages, and pain and suffering until that coverage is exhausted. Your SUM coverage will then make up the difference of the compensation you’re entitled to until it is exhausted. Many drivers choose the minimum amount for both BIL and SUM coverage, and if this is the case, you could be at a loss to recuperate your damages. Especially if the at-fault party has little-to-no assets. Choosing the minimum amount for these two types of coverage can lead to a serious financial crisis.
The minimum coverage New York State insurance carriers offer is $25,000 for one person, $50,000 per occurrence, and $10,000 for property damage. But what could this amount really do if you are seriously injured? How would this scarce amount of money help fully compensate for your damages? And what if other family members were seriously injured in this type of accident? In many cases, it simply won’t help at all. $25,000 is a grossly inadequate amount to compensate for damages in a serious personal injury case.
In a vast majority of the car accident cases we’ve seen, the at-fault driver had the minimum Bodily Injury Liability coverage or was not covered at all with little-to-no assets. It’s not always the case, but many times it is. This is why it’s imperative to consider a higher amount for your Supplemental Uninsured Motorist coverage. If you choose the minimum, and the at-fault party is uninsured and with little-to-no assets, you won’t receive compensation from their insurance company, nor will you be able to get compensation from them through a lawsuit. If the at-fault party has the minimum amount of BIL coverage, you’re entitled to that compensation, but it will do little to recuperate for your damages if you’re seriously injured.
As you may know, insurance brokers get commissions based off of their sales. Some won’t tell you about how important it is to have a high SUM coverage to protect you and your family residents. Why? Because they know you may think having a higher-than-minimum SUM coverage will create a drastically higher monthly premium. The last thing insurance brokers want to do is scare you away from an insurance package, and the first thing they want to do is make the sale. So, some don’t push you to have a higher SUM coverage out of fear of losing that sale. But if you actually calculate the annual add-on, it’s not that bad. And it’s worth it.
We urge you to get a simple quote online to see how much money will be added on to your annual premium if you raise your SUM coverage. Whatever amount of money that is, compare it to the amount of money you would lose if you were hypothetically hit by an underinsured or uninsured driver, whether you were in a car or pedestrian accident, and sustained serious injury. You wouldn’t be able to work, you’d experienced hefty medical bills, both your car and your life could be totaled – the list could go on and on. You’ll probably come to the realization that it is most definitely worth it to get the highest SUM coverage you can afford. If you have a high SUM coverage, you and your family residents are protected in case you’re injured by an underinsured or uninsured driver. We simply cannot overstate how very important a high SUM coverage is.