WHAT TYPES OF INSURANCE ARE AVAILABLE TO COMPENSATE A CAR, TRUCK OR MOTORCYCLE CRASH VICTIM?

If you are injured in a traffic accident due to the carelessness, negligence or recklessness of another, you may be looking for compensation for the medical expenses, lost wages, pain and suffering, and other injuries and damages caused by the other party. Typically, your compensation will involve some measure of insurance. In this post, we will attempt to explain the nature and type of insurance available to compensate you for your injuries. While this post is intended to be helpful, it is no substitute for the assistance of an attorney. If you are injured it is highly recommended that you call an attorney.

Third Party Liability Coverage:

West Virginia, Ohio and Pennsylvania, and most other states, require that motorists carry some minimal amount of liability insurance. In West Virginia the limits are $20,000 per individual and $40,000 per accident, in Pennsylvania minimum insurance requirements are $15,000 per person and $30,000 per accident and Ohio recently raised its limits to $25,000 per person and $50,000 per accident. Tractor trailers are required by federal law to carry $750,000 in coverage.

In the event that you are injured as a result of another’s negligence, you will first look to the other driver’s insurance policy for insurance coverage to compensate your for your medical expenses, lost wages, pain and suffering, and mental anguish. Assuming the other motorist has liability coverage, that insurance company has an obligation to defend and indemnify its policy holder. The duty to defend requires the carrier to provide the negligent driver with an attorney to investigate and rebut your claims and the duty to indemnify requires them to pay any judgment awarded against the insured as a result of the insured’s liability in operating their motor vehicle. The carrier also has duties, either under the policy or state law, to independently investigate the claim and, if prudent, to pay it. Understand, however, that the insurance carrier’s duties run to its insured and not you. The insurance adjuster therefore will be working from day one to minimize the amount of money that you recover.

Uninsured Motorist Coverage:

If you are injured in a car or motorcycle accident and the other driver does not have insurance, you will look to your own insurance carrier for uninsured motorist’s (“UM”) coverage to compensate you for your financial and personal losses. In West Virginia, motorists are required to ave uninsured motorists coverage. In Pennsylvania and Ohio, this coverage is optional. Regardless of where you live, if you don’t have uninsured motorists coverage, buy it. As the name implies, this coverage protects you in the event that the person that hit you does not have any coverage. Once it is determined that the other person (known as the tortfeasor) does not have coverage, your insurance carrier essentially steps into the shoes of the other person’s nonexistent carrier. There is a major difference, however, as here, the contract of insurance is between you and the carrier. You are, therefore, in a “first-party” relationship and the carrier must act in good faith towards you. If your carrier fails to timely and adequately assess and pay your claim, they could expose themselves to additional damages in an insurance bad faith suit. In other words, unlike in the “third-party” situation discussed above, here the carrier does have an obligation to deal fairly with you or else they could end up owing you more money.

Underinsured Motorist Coverage:

As its name sounds, this coverage protects you, the injured party, in the even that the negligent driver does not carry enough liability insurance. This is optional insurance coverage in Pennsylvania, Ohio and West Virginia. If you don’t have any underinsured (“UIM”) coverage, purchase some. Many drivers are inadequately insured and my firm has seen far too many people with catastrophic injuries and limited insurance resources to cover them. As with the uninsured coverage discussed above, the UIM carrier is in a “first party” position and must deal with you in good faith or risk additional damages.

Health Insurance, Medicare, Medicaid, and Worker’s Compensation:

Many clients mistakenly assume that because an accident was someone else’s fault, the other person’s insurance will cover the claim and they should not submit their medical bills through their private health insurance, Medicare, Medicaid or Worker’s Compensation. This is not the case.

First, if you are covered by them, health insurers, whether private or public, are obligated to pay for your care, regardless of who is at fault. Second, until you have a completed settlement or a judgment, there is no guarantee that you will receive any money or how much money you will receive. Lastly, you will likely end up receiving more money in your pocket if you submit it through health insurance as a result of the health insurer’s reduced rates.

An example would be helpful. Let us assume that you are injured riding a motorcycle in West Virginia when someone runs a stop sign and hits you. You suffer a broken leg and incur $10,000 in medical bills. The other party has $20,000 in coverage and you have no UIM coverage. You settle the case with the insurance company for the limits of the insurance policy ($20,000) but did not submit your medical expenses to health insurance. You now owe the doctors and hospitals $10,000 or half of your total settlement. Now assume you submitted it to health insurance and they paid, based on their negotiated rate, $5,000 for the same medical care. You swill have to pay back the health insurance company but you owe them half of what you would have owed the doctor and hospital. Medicare, Medicaid, private insurance and worker’s comp will almost always pay less for the same care than you would out of pocket. Furthermore, in West Virginia, you can recover the entire amount billed and not just the amount paid. Thus, while every circumstance is different and you should consult with an attorney, it usually makes sense to submit your medical bills from a car accident to health insurance.

Medical Payments Coverage:

This is insurance coverage for medical payments for injuries sustained while driving or riding in a car. This coverage is a part of the auto policy. It is no fault policy, meaning that if the owner of the car has this coverage on the car, it covers the driver and passengers regardless of who is at fault in causing the accident. This coverage only covers medical expenses. It is in many other respects, similar to health insurance.