Q: I was involved in a serious motor vehicle accident in which I broke my leg due to another driver’s negligence. I have been in touch with the other driver’s insurance company who has indicated that he has the minimum 20/40 coverage available to cover my injuries and medical bills. They offered me the policy limit, but I’m not happy. I have had two surgeries and incurred almost $60,000 in medical bills. What can I do? A: First, do not settle with the other driver’s insurance company until we get more information. The other driver is carrying a 20/40 policy, meaning they have $20,000 per person / $40,000 per accident (no matter how many people were injured) to cover your personal injuries and medical bills above the $8,000 in Personal Injury Protection (PIP) available through your car insurance. $20,000 is not going to cover the damage that this person has caused. However, you may have additional coverage under your own car insurance called “underinsured” motorist coverage. Let’s say you carry a 100/300 optional bodily injury provision on your car insurance policy. You then would have an additional $80,000 of coverage available to you above the other person’s $20,000 policy limit ($100,000 – $20,000 from the other car = $80,000 underinsured coverage). Additionally, you may have Medical Payments coverage under your car insurance to cover your medical bills. These are benefits that you pay for through your premiums in the event of this type of accident, and recovery under these provisions will not increase your rates because the accident is not your fault. I have advised you not to settle with the other car’s insurance company, even though they are offering you the most money they can, because you must first get permission from your car insurance company to settle with them if you are pursuing “underinsured” benefits. If you do not get this required authorization in writing before settling, you are precluded from collecting under the underinsured provision of your policy. As always, an experienced attorney should be consulted to navigate these issues so you do not lose benefits.
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