Todd Law Firm October 2019

October 2019 512-472-7799

The Insurance You Need to Have What Holes Are Hiding in Your Policy? Eminent Domain | Family Law | Personal Injury

Most people consider car insurance a black- and-white proposition. Either you have it or you don’t. Texas law states that you have to have it, so you sign up, pay the premiums, and get on with it. Odds are you never even think about your policy again. Unless, of course, you happen to be in an accident. When the worst does happen, people often find the insurance they have is sorely lacking in some key areas. The only way to avoid that fate is to check your policy today. In Texas, the law requires every driver to carry insurance at certain minimum levels. As of this year, those minimums are $30,000 for injury per person, $60,000 per accident, and $25,000 for property damage. What these figures mean is that in the event you cause an accident, your insurance will pay up to these levels. Now, that may seem like a good amount of protection, but it’s actually far from adequate. If you happen to cause a serious accident, the other party’s medical bills may be far in excess of $30,000. The insurance isn’t going to pay for it, so the only recourse the injured person has is to come after you. In other words, meeting the legal status that qualifies you as having insurance is not the same thing as being insured to a safe degree. Even worse, these low-coverage limits can also hurt you if you’re not at fault. In this scenario, the roles are switched, but the dialogue remains the same. Insurance pays out the policy limit — and leaves you to figure out the rest. If you’re injured in an accident with a commercial vehicle, there should be a higher level of insurance available. (Side note: The amount of insurance coverage commercial trucking companies carry should let you know just how important it is.) Regardless of

who is on the other side of your accident, in a serious wreck, you can exceed the insurance policy limits in a hurry. A week in a hospital, especially in intensive care, can blow through Texas insurance minimums. And this is before you begin to deal with lost wages and future care needs. Even scarier, by most industry estimates, somewhere between 10–20% of passenger cars on the road in Texas are uninsured. If you get injured in an accident and the person at fault is uninsured (or underinsured), you’re going to need to go after them for the money for your medical bills, lost wages, etc. Unfortunately, apart from insurance, the majority of people’s asset in Texas are “judgment-proof”. This means you might win against them in court but may never collect a dime. Here’s the good news: There is a policy within auto insurance coverage called uninsured/ underinsured motorist coverage (UM) that allows your insurance to cover expenses in exactly this situation. It covers your losses when you are hit by someone with little or no insurance (or a “hit and run” driver that flees after an accident). The bad news is that too many people waive this coverage. In Texas, all insurance policies must come standard with UM, but customers can opt out of it. Often, seeing only that their premiums will go down, people waive their UM without understanding what it really means. The second you’re done reading this newsletter, go see if you’ve opted out. If you have, call your insurance provider and add UM coverage back to your policy. As an attorney, my advice when it comes to auto insurance coverage is pretty simple and direct. Get as much coverage as you can reasonably afford, and make sure you have as much “UM” (Uninsured/Underinsured Motorist)

coverage as you can. Usually, it only costs a bit more to increase your insurance limits to a substantial degree, and not much more than that to add UM coverage. The bottom line is that having insurance doesn’t mean much if you don’t have enough of it or the kind that covers you when the other driver has little or no insurance. The idea of insurance is that you’re “covered,” but it’s hard to be totally covered by a blanket with a lot of holes in it. Make sure your policy is patched up.

-David Todd | 1

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