Being involved in an auto accident is never a good thing. At minimum you walk away with physical damage to your vehicle that requires it to be repaired or replaced. Worst case scenario, your vehicle is totaled and you suffer serious physical injury that requires hospitalization and results in lost wages due to an inability to work during your recovery.
But being involved in a motor vehicle accident with an uninsured or underinsured motorist can quickly make a bad situation even worse. It is unlikely that you can bring a successful personal injury claim against the motorist – a person who has no insurance is unlikely to have enough assets to pay damages if you win in court. So what can you do to cover your losses? That is where California uninsured and underinsured insurance comes in to play.
Uninsured and Underinsured Laws
California uninsured and underinsured (UM/UIM) motorist insurance policies are purchased by an individual as part of his or her own automobile insurance. They are used in the event you are injured in an auto accident with a driver who either has no insurance, or doesn’t have enough insurance to pay your damages. Uninsured and underinsured claims are filed against your own insurance company. Although they do have similarities, the policies come in to play under different circumstances and have slightly different rules.
California Uninsured Motorist Laws
Uninsured motorist insurance pays for almost all losses the other driver’s insurance company would have been responsible for, if the driver had insurance. It covers the driver and any passengers in the vehicle. It may also cover you if you are involved in a bicycle-motor vehicle, pedestrian-vehicle accident, or a hit and run accident.
Uninsured motorist insurance only pays for damages up to your UM/UIM policy limit. So if you have purchased $50,000 in uninsured motorist insurance, your insurance company is only required to reimburse you up to that amount, regardless of the actual amount of your damages. Uninsured motor vehicle insurance pays for the following damages if applicable:
- Medical bills associated with your injuries;
- Pain and suffering;
- Lost wages, and;
- Loss of future income.
Uninsured motorist policies do not, however, pay for damage or loss to your vehicle. This is usually covered under your collision coverage. It also does not cover punitive damages, which are damages paid by the other party as punishment for his actions. You may, however, be entitled to recover punitive damages against your insurance company if they handled your claim in bad faith, but any recovery would be based solely on their actions during negotiations, and not based on the injuries you suffered as a result of the car accident.
California law prohibits an automobile insurance company from increasing your premiums if you file an uninsured motorist claim.
California Underinsured Motorist Laws
Underinsured motorist insurance pays the difference between your damages and the limits on the other driver’s insurance policy. In an auto accident involving an underinsured motorist, the other driver has insurance, but not in an amount sufficient to cover your damages. So if you incurred $75,000 in damages, and the other driver had insurance that paid $25,000, you would need to file an underinsured motorist claim against your insurance company for the difference. However, your insurance company is only required to pay up to your policy limits. This means that if your underinsured motorist insurance limit was $50,000, you would only be entitled to receive $25,000 from your insurance company.
If you and your insurance company cannot reach an agreement on payment under your uninsured/underinsured insurance coverage, the only remedy under California law is to go to arbitration. You cannot file a suit in court to recover damages under your uninsured/underinsured motorist policies. Once arbitration is settled you may, however, file suit in court against your insurance company for bad faith in negotiating payment.
Uninsured, Underinsured Auto Accident Attorneys
If you have been involved in a motor vehicle accident with a driver who was uninsured or underinsured, contact our attorneys at Appel Law Firm LLP in Walnut Creek. Our attorneys have more than 60 years’ combined experience negotiating with automobile insurance companies for the successful payment of uninsured and underinsured motorist claims. The aftermath of an automobile accident is stressful enough without having to deal with auto insurance companies. Let us help alleviate some of that stress so you can focus on your recovery. Call us toll free at 888-527-0674, or complete our online form, to schedule your free initial consultation today.