Purchasing an automobile involves a lot of decisions. Usually the last decision is car insurance. Often buyers will purchase what a salesperson says is “Full Coverage.” Well, the term “Full Coverage” can be deceiving. It often represents the minimum coverage required by law. This article will explain why this is a potentially dangerous financial decision for most people.
For decades, I have represented injured people who have the legal right to be compensated for loss of health, well-being, lost wages, property damage, and more. Unfortunately, I’ve often seen people not get what they are entitled to. This was not because it wasn’t a good case or we didn’t win in court; people often don’t get what they deserve because the defendant didn’t have insurance or didn’t have enough insurance. And most importantly, the person who was wrongfully hurt, often did not have enough insurance.
Virginia requires the following minimum coverage:
• Bodily injury/death of one person $25,000
• Bodily injury/death of two or more persons $50,000
• Property damage $20,000
If you opt not to obtain the minimum coverage required, you will have to pay a $500 Uninsured Motor Vehicle fee. This does not provide insurance; it only allows you to drive at your own risk.
Consider these concerns if you have “Full Coverage,” but in-fact only have the “Minimum coverage” required by law:
1. If you have paid the Uninsured Motor Vehicle fee, you have no insurance. A claim by someone to whom you caused injury or damage will likely result in a civil judgment against you. You will have to hire a lawyer, and your license may be suspended until judgment is paid in full with interest.
2. A property damage claim against you could be equally catastrophic. Think about the number of vehicles on the road today whose value or repair costs would exceed $20,000. Judgement against you would likely be obtained for the amount not covered by insurance.
3. A bodily injury claim against you is even more problematic. The cost for medical care often exceeds $3,000. Our clients regularly require follow up medical care in the form of physical therapy or even surgery. The law entitles them to compensation for pain, suffering, inconvenience, lost wages, and emotional distress. Someone who has a judgement against you can garnish your wages, and attach bank accounts and other property. Sometimes bankruptcy is the only solution.
4. Then there is the “uninsured” and “unidentified” driver dilemma. Many drivers don’t buy insurance, and many who negligently cause accidents “hit and run.” In either situation the injured party must rely on their own coverage to pay for damages. Too often the property damage and the injuries are substantial, and the minimum uninsured motorist coverage, to quote the late, great Barry White, “It’s just not enough!”
Take time to think or rethink about your automobile insurance policy. It’s a multi-page document with many legal terms, but it is surprisingly simple. If you don’t understand something, seek professional help from your insurance agent or your attorney.
Keep in mind that the problem of the public generally not having enough coverage is brought on by the insurance industry itself. It is in that industry’s interest to sell a lot of policies with low coverage amounts. Ask your insurance agent about the cost of substantially increasing your coverage. Most of my clients have found it to be surprisingly inexpensive. Once you discover how much more coverage you can get for not much additional premium, you’ll realize that “Full Coverage” minimum limits policy was not such a good deal after all.
Eric O. Moody is an attorney with the law firm of Eric O. Moody and Associates, P.C. which has offices in Portsmouth and Chesapeake, Virginia. The firm broadcasts “IT’S THE LAW,” a weekly legal question and answer talk show on Hampton University’s radio station, WHOV 88.1 FM. The firm’s website is WWW.EOMOODYLAW.COM