Based on my experience talking to people who have been involved in auto accidents, I have noticed that a lot of them don’t know what their own auto insurance policy limits are, what they mean or why they are important. The purpose of this blog post is to help you gain basic understanding of how insurance policy limits work to provide you coverage in case of the accident.
In Virginia, the minimum required coverage on auto insurance policy is $25,000/$50,000. What it means is the $25,000 is the insurance company’s maximum liability for 1 person per 1 accident and $50,000 is the insurance company’s maximum liability for multiple claims resulting from the same accident. For example, if you got into an accident that was someone else’s fault and got injured, and at fault driver has 25/50 limits, it means you cannot recover more than $25,000 from his insurance for your injuries. If, for example, you had 3 other people in a car with you, and you all got injured, at fault driver’s insurance can only provide a total of $50,000 maximum to be distributed among all 4 of you.
Let’s say it was a really bad accident with severe injuries and $25k is not enough to compensate you for all of your medical expenses and your pain and suffering. In this case, your own insurance would step in and provide you with additional funds if you have enough underinsured motorist coverage (UIM). The amount of the available UIM coverage is the difference between at-fault driver’s insurance limits and your own insurance limits. Going back to our example, the at-fault driver’s limits per person are $25,000. And let’s say you have insurance limits of $100,000 per person. $100,000 minus $25,000 is $75,000. It means you have up to additional $75,000 to cover you for your injuries. But what if you only have the minimum coverage, the same as our driver at-fault here, $25,000 per person. It means you can’t recover any additional money from your insurance for your injuries ($25,000 minus $25,000 is 0). So, $25,000 from the defendant’s insurance would be the maximum you can get, no matter how serious the accident was.
Of course, this explanation is very simplified and sometimes are other sources of insurance excess coverage, like the separate insurance policies of the members of your household, umbrella policies etc. The determination is made on case-by-case basis and requires some investigation and the knowledge of the ins-and-outs of the insurance law.
But the two lessons I would like you to take away from this post are:
It is very important to have a sufficient insurance coverage to protect yourself in case of being injured by the uninsured, underinsured, or unknown driver (which can happen in Hit & Run accidents);
If you’re injured in an accident that is not your fault, you need a good personal injury attorney who will explore all the options and make sure you receive maximum recovery.
If you have any further questions, please do not hesitate to contact the author of this article, Olga Pazilova, Esq.
Disclaimer: This article is for general informational purposes only and does not, and not intended to, constitute a legal advice.
Ernest Law Group, PLC is located in Virginia Beach, VA and serves clients in and around Norfolk, Portsmouth, Fort Monroe, Hampton, Virginia Beach, Chesapeake, Chesapeake City County, Hampton City County, Norfolk City County, Portsmouth City County and Virginia Beach City County.
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