People are reluctant to pursue claims against family members and their own insurance. But if a family member breaks the Rules of the Road and injures you, their insurance ought to compensate you for the damage caused. Insurance should take care of family over strangers. This is a claim against insurance and not against personal assets. Why should the injury victim be stuck solely responsible for the damage? Further, this reluctance only benefits the insurance company – not you or your family. Let’s turn to two areas that are not well understood: uninsured and underinsured motorist coverage.

Uninsured Motorist Coverage

All auto insurance policies carry uninsured motorist coverage (in Missouri and Illinois) in the amount of $25,000. This provision means that if you, a family member or friend are injured in an automobile accident and the driver who was at fault did not have insurance and is uninsured, your insurance pays. This includes compensation for medical expenses, wage loss, pain and suffering, and emotional distress. Every policyholder has this coverage and it is the same as if the other driver actually did have insurance-but your insurance policy provides coverage for the other driver’s negligence.

Uninsured coverage applies in a wide variety of situations. If there is a hit and run or phantom driver, your uninsured coverage applies. If your car is struck by a driver who then drives away and you don’t know who it is; if you’re walking and you are struck as a pedestrian by a driver who leaves; or a circumstance where you do not know or cannot track down the identity of the phantom driver, you have an uninsured claim under your own policy to recover all your damages. More typically this coverage is used in cases where the driver who rear-ended you or pulled out and struck you or did not look when they changed lanes and struck your car does not have insurance. Also, they could have failed to pay their premium and their insurance was canceled even though they had an insurance card at the scene and you think they had insurance. Under these circumstances, you can recover under your uninsured policy.

You should still make an uninsured claim even if you are worried your premiums may go up. We do not know why or how insurance companies increase premiums-some do not increase it with a claim and some do. Further, you already have a claim on file-you have likely asked to get paid for your property damage or have a med pay benefit that you are using. Most of my clients who had their insurance increase a little bit following an uninsured claim end up going out and finding cheaper insurance with another company that provides better coverage. We often stay with our insurance companies for a long time and don’t look around for different prices or benefit shop. Moreover, your uninsured claim may be worth a lot of money and you may be entitled to a significant benefit and compensation for that claim. Why would you not make an uninsured claim for $50,000 or $100,000 if your rates are going to go up by $50 every 6 months? The reason you pay these premiums is to get the benefits of the insurance coverage when you need them. If you are reading this and are contemplating an uninsured claim, you need it.

Amount of uninsured coverage and stacking are two important areas. You may just have the minimum uninsured amount, or you may have bought higher uninsured coverage. We can figure this out for you, or you can call your insurance agent and find out yourself. Have them email you the terms of your policy or your declaration page. Sometimes insurance companies print this off on your insurance card. Many times insurance companies sell $50,000 uninsured policies so you may have that amount of coverage.

In addition, there is a legal idea called “stacking” insurance coverage. The law in Missouri is that you get to stack the minimum $25,000 uninsured from every vehicle you own under that same policy. This is because uninsured coverage is mandatory and the State of Missouri, both through statutes and court decisions, requires that coverage. For example, if you are injured and your vehicle has $25,000 of uninsured coverage, but you also own two other vehicles that are insured on that policy, you will have $75,000 in uninsured coverage. Insurance companies will never tell you this and very often try to settle uninsured claims directly with their claimants without advising them about stacking. I have had instances where a family with very large damages is contemplating a $25,000 settlement that is being pushed by an insurance company. Upon inquiry, we discovered that the family had 3 additional cars and actually had $100,000 in coverage available. If you settle for the $25,000 and sign a release, you cannot go after the additional coverage. There are also unique circumstances if you are driving a company vehicle or are a pedestrian that provides you this coverage as well.

Make sure you get fully compensated for all damages regardless of whether you are pursuing an uninsured claim against your own insurance company. You should make sure you get all your medical treatment and reach your maximum medical improvement. Your claim should include all of your medical expenses, your wage loss damages, and all the pain you have gone through and the emotional distress you have experienced. You also should get your medical payment coverage in addition to your uninsured claim.

In conclusion, there are tragic examples of people and families being significantly damaged (or killed) in automobile or truck crashes where the defendant has no insurance. Make sure you pay yourself back for those losses and provide you and your family financial security with an uninsured motorist claim. You bought and paid for that insurance for a reason and it should be there to help you or your family under these circumstances. Too often, your insurance company is not going to fully inform you about all of your benefits, or pay you adequately. I have had many examples of this--real, tragic losses where the insurance company does not tell their insured that they can make an uninsured motorist claim or does not tell their insured that they can stack their coverage. It is extremely important to talk to a lawyer about this to navigate the claim, insurance, and damage aspects of the uninsured claim.

Underinsured Motorist Coverage

Although not mandatory, many automobile insurance policies contain coverage for when a negligent driver injures you or your family and that driver does not have enough insurance to cover all your damages. If your damages are $100,000 and the defendant driver who struck your car or hit you while you were walking only had $25,000 in insurance coverage, you are underinsured for $75,000. So, all insurance companies sell coverage to fill in this underinsured gap. To find out if you have underinsured coverage, look on your insurance card or call your insurance agent.

To make an underinsured claim, you first have to settle the claim with the main tortfeasor, or person who injured you, and exhaust their coverage. So, if you are rear-ended by a negligent driver, you first have to resolve the claim against the person who rear-ended you. This means getting all of your medical care, reaching your maximum improvement, and making a claim against that driver. Sometimes these cases will settle before suit, sometimes after you hire a lawyer and suit is filed. It is very important to note you have to get all of the money available from the negligent driver. If the negligent driver has $25,000 in insurance, and you settle that claim for $20,000 you cannot get underinsured coverage.

You must completely exhaust all other available insurance before you can make a claim for underinsured coverage. So, under the previous example, you must settle the claim against the driver who rear-ended you for $25,000. It is important that you first put your underinsured carrier on notice, and let them know that you have the claim, let them know that you are settling and resolving the case against the driver who hit you, and make sure they do not object. Then, your claim is ripe against your underinsured carrier. This does not mean that you cannot let them know early on about the claim, you should notify them when you file. This should be done in writing, and they will give you a claim number.

Very often, insurance companies will not tell you that you have underinsured coverage or tell you how to make that claim. Often they will have separate claims adjustors and separate departments for underinsured coverage. They do this for a reason: to make it harder to make an underinsured claim. The adjustor for your property damage and your medical payment coverage will not tell you that you have a possible uninsured claim or a possible underinsured claim. Rather, you must press the issue. As a lawyer, I even have to pursue these vigorously. I recently made a clear underinsured claim and had adjustors calling me asking me if I was really trying to settle a property damage claim, get medical payment coverage, or what exactly I was writing about. They knew and it was perfectly clear-but by putting up obstacles they decrease their payouts and improve their profits. Make sure that when you file an underinsured claim that you do so clearly, in writing, and that the insurance company assigns you an underinsured claims adjustor separate from any property or med pay adjustor. Communicate with that adjustor about the status of the claim and advise that adjustor when you are about to settle and resolve the claim against the defendant who was negligent.

With underinsured coverage, there are “set off” and other issues so it is sometimes difficult to determine the exact amount of coverage. Underinsured policies are often written to say that they get a “set off” or credit for the amount you recovered from the underlying insurance of the person who injured you. This is actually a misrepresentation on the part of the insurance company which is regularly done. For example, you buy $100,000 in underinsured coverage and it is promised as such, and you pay the premiums on that. What you do not know is that it really only offers $75,000 in coverage.

Why? Assume that you are injured by a negligent driver and your damages are $500,000 (because you herniated a disc in your neck, had to have neck surgery, have permanent pain and problems for that, need lifelong medical treatment and there are significant wage loss damages). You sue the driver who rear-ended you and caused this accident and you settled the claim for his insurance policy limits of $25,000. Now you go to your underinsured carrier and make a demand for the $100,000. They will say that under a part of your policy the amount that you got from the driver who rear-ended you is credited against the policy limits of your underinsured coverage so you can only get $75,000. If the driver who rear-ended you had $100,000 and you settle and resolve that claim for that full $100,000, you can make no underinsured claim. The amount to be credited against the coverage is equal to the amount of insurance. I have long thought that this is a misrepresentation and improper tactic on the part of the insurance companies. Every driver in Missouri is going to have at least $25,000, and if that is credited against the underinsured policy amount, that reduces the amount of underinsured coverage by $25,000. If the driver who hit you has no insurance you have an uninsured, and not underinsured, claim.

Many policies try to limit underinsured coverage. For instance, if the driver did not have any insurance, then it is an uninsured claim not underinsured. The insurance policy will preclude you from recovering from the underinsured provision of the policy under these circumstances. If you do not get all of the money in a settlement from the underinsured driver who hit you or if you do not communicate to your insurance company, they may find grounds to deny your claim. Many times insurance companies will decline coverage and say there is no coverage, or that they will not pay a loss, with strained and inaccurate readings of the insurance policy.

Make sure that you get a lawyer or someone to review these insurance policies. Do not take the insurance company’s word for this, even though you are their insured, they are not on your side and they are actively working to decrease your recovery as much as they can. It is just the way insurance companies operate. They will wrongly read their policies, they will misinterpret policies, they will ambiguously word policies on purpose to give them wiggle room, and employ lots of other tactics to decrease the amount they have to pay out to claimants, including their own insured customers. They do not owe a fiduciary duty to their insured clients, even if you think they should.

Regarding damages, make sure you get all your medical care and fully complete your medical course of treatment. It may be that when you are completely done with treatment you still are not 100% and have some degree of disability. It is only after you complete your medical care and reach your maximum medical improvement that you should resolve your case.

Procedurally, this is an insurance claim that only sometimes results in litigation. Make your claim to your insurance company in writing and make sure that you have an underinsured claim, not just a general claim. Verify that you have a claim number and a claim representative with whom you are communicating. Ensure that you hire a lawyer before you sign any releases or settle an underlying claim. If the insurance company takes an improper position and does not fully pay your underinsurance claim, you should file a suit and litigate against them; hire a qualified lawyer who has handled similar claims, knows the procedures, and has experience in interpreting the insurance policy and challenging the insurance adjustor’s slanted interpretation of insurance policy language. We often find more coverage after the initial denial from the insurance company. Sometimes that is through persuasion with the insurance company and sometimes it is through a lawsuit, litigation, and a judgment against the insurance company. We have many examples of this.

Note that in Illinois, underinsured motorist coverage claims are arbitrated and you don’t have the right to file a suit in court. In Missouri, those arbitration provisions are not enforced. Arbitration in Illinois fosters quicker resolution of these claims. But the downside is that you do not have the right to a jury trial and it can and does lead to insurance company abuse. See appendix for a unique insurance article.