Our office handles many bodily injury automobile accident cases. Sadly, in far too many of these cases, the negligent driver (the person responsible for the accident) does not have enough insurance coverage to provide adequate compensation for the injuries, lost wages, and pain and suffering caused as a result of the accident. Fortunately, New York Insurance Law § 3420(f) allows for the purchase of Supplemental Uninsured/Underinsured coverage (“SUM”) to provide protection if you are in an accident and the owner and/or driver of the vehicle responsible for the accident does not maintain enough coverage to pay for your injuries.
In New York, the minimum insurance policy coverage requirement is $25,000 for each injured person, and $50,000 total per accident. All too often, many drivers are only obtaining this minimum coverage.
How does underinsurance work?
Here is an example: if you were involved in an automobile accident because another driver ran a red light, and you sustained multiple fractures, were hospitalized for some period of time, required treatment at a rehabilitation facility, have permanent consequences from these injuries and are no longer able to maintain your employment, you would be entitled to a significant monetary award. However, if, after suffering these devastating injuries you learn that the driver that caused the accident only maintained a $25,000 policy limit, your maximum recovery for your injuries (no matter how catastrophic) from the insurance company will be $25,000. Any recovery above $25,000 would have to be obtained from the personal assets of the driver and are often very difficult to collect.
If you have underinsurance in an amount in excess of $25,000, you would be eligible to recover additional money from your own policy’s SUM coverage.
As an example, if you maintained $100,000 SUM coverage, you would be eligible to receive up to an additional $75,000.
You may purchase SUM coverage in an amount up to the bodily injury limits of your policy subject to a $250,000 per person or $500,000 per accident or a combined single limit policy of $500,000. You may also maintain SUM insurance with a maximum of $100,000 per person or $300,000 per accident or a combined single limit policy of $300,000 if you have a personal umbrella policy with limits of at least $500,000 which also provides SUM coverage.
If you do not have underinsurance or do not maintain sufficient insurance coverage, you should contact your insurance agent as soon as possible. For a small amount of money added to your insurance premium, you can have the peace of mind that you and members of your household are protected if involved in an accident with someone that has either no insurance or limited insurance.