Uninsured and Underinsured Coverage

Answer:

In the State of Pennsylvania, opting to purchase under-insured motorist coverage with your automobile insurance policy gives you protection in the event you are injured in a serious motor vehicle accident and the party that caused the accident is under-insured or doesn’t have sufficient insurance to cover or compensate you fully for your injuries.

Since under-insured motorist benefits are optional, you’ll need to add it to your standard coverage. When you do, you’ll have an avenue to pursue compensation in the event the person who causes an accident is under-insured. This protection is in addition to the standard coverage that compensates you for your medical bills and wage loss if someone else causes an accident, and your own liability coverage if you’ve caused an accident.

When you have this type of coverage, you can seek compensation for the difference between your damages and the amount of insurance the other motorist has.

For example, if the other motorist only carries the minimum insurance of $15,000 and your damages are worth $100,000, you can go to your insurance company and make a claim against them saying:

 “This individual is under-insured. My damages are much more serious than what their insurance covers. I want you to pay the difference between the $15,000 and the $100,000.”

 The process then works similarly to the usual process of making an insurance case. You will be expected to present medical bills and medical reports that prove to either the insurer or a jury that your claim is worth $100,000.”

At that point, the insurance may amicably agree to compensate you according to your request. If not, the terms of your insurance policy will dictate one of two options

The first possible option is arbitration. You pick an arbitrator, they pick an arbitrator, and a neutral third party is agreed upon. The arbitrators then hear the case and make a decision on its the value based on medical reports and the testimony of witnesses.

If your policy does not have an arbitration option, you will need to sue the individual insurance company for under-insured motorist benefits. Going this route means pursuing the insurance company in court instead of the under-insured individual.

Your case is presented to a jury whose job it is to make an award against the insurance company, up to the amount of coverage you’ve purchased.

How much under-insured motorist coverage you purchase is up to you. Premiums will vary depending on how much coverage you buy. Coverage typically starts at $15,000 and goes up from there, enabling you to purchase $50,000, $100,000, or even up to $1 million of under-insured motorist coverage.