Many drivers are unsure how much they can recover from a UIM claim, leading to financial uncertainty. It is important to fully understand UIM coverage, including who qualifies, how payouts are calculated, and the legal framework governing such claims in California.
Underinsured Motorist Coverage (UIM) helps protect California drivers from financial loss when the at-fault driver lacks sufficient insurance. With the rise in underinsured drivers, many face uncovered medical expenses, lost wages, and property damage when they are involved in an auto collision.
If you've been involved in an accident and need legal guidance, contact Fassonaki Law Firm P.C., a trusted car accident lawyer in Los Angeles, CA, to ensure you receive the compensation you deserve including a possible UIM claim.
This blog will provide clear and practical insights into UIM claims by addressing key questions such as:
- How much can I get from a UIM claim?
- What factors influence my potential payout?
- How do California insurance laws impact my claim process and compensation?
Understanding Underinsured Motorist (UIM) Coverage
Underinsured Motorist (UIM) coverage is a crucial component of auto insurance that provides additional financial protection when the at-fault driver's liability coverage is insufficient to cover the damages and medical expenses of the policyholder.
What is the Difference Between Uninsured Motorist (UM) and Underinsured Motorist (UIM) Coverage?
- Uninsured Motorist (UM) Coverage: Protects you when the at-fault driver has no insurance.
- Underinsured Motorist (UIM) Coverage: This applies when the at-fault driver has insurance, but their coverage limits are too low to fully compensate you for your losses.
- While UM helps in cases where the negligent driver lacks insurance, UIM steps in when their policy does not provide adequate financial protection.
How Does UIM Coverage Work?
- When an accident occurs, the at-fault driver's insurance pays up to their policy limits.
- If the victim's damages exceed that amount, UIM coverage can cover the remaining costs up to the victim's own insurance policy limits.
- The victim must have elected or purchased UIM coverage to be afforded the UIM coverage.
Real-life examples to illustrate scenarios where UIM coverage applies:
Scenario 1: A driver with only $15,000 in bodily injury liability coverage causes an accident, but the total medical expenses for the victim amount to $50,000. If the victim has UIM coverage of $50,000, they can recover the remaining $35,000 through their insurance.
Scenario 2: An at-fault driver carries $25,000 in liability coverage, but the injured party incurs $100,000 in medical bills and lost wages. If the injured party has a UIM policy limit of $100,000, they can claim an additional $75,000 from their insurance provider to cover the shortfall.
With sufficient UIM coverage, policyholders can protect themselves from financial hardship caused by accidents involving underinsured drivers. Understanding this coverage and selecting appropriate limits can make a significant difference in securing economic stability after an accident.
How Much Can You Get from an Underinsured Motorist Claim?
The amount you can recover from an underinsured motorist (UIM) claim depends on several factors. Think of it like a safety net that helps cover the gap when the at-fault driver's insurance has insufficient limits to cover your expenses. Here's what affects how much you can receive:
· Your UIM policy limits: This is the highest amount your insurance company will pay under your underinsured motorist coverage. Your payout will be limited if your UIM limit is low, even if your damage is much higher.
· The at-fault driver's liability limits: This is how much coverage the other driver has. Suppose their insurance covers only a small portion of your total costs, your UIM coverage can help fill in the gap—but only up to your UIM policy limit.
· Total damages incurred: This includes your medical bills, lost wages from missing work, physical therapy, and even pain and suffering (the emotional and physical toll of the accident). The higher these costs, the more coverage you may need to recover fully.
Example Calculations Scenario:
The at-fault driver carries $15,000 in liability coverage. Your total damages are $50,000. You have $50,000 in UIM coverage. Your insurance can cover up to $35,000, bridging the gap left by the at-fault driver's insufficient coverage.
Understanding how insurance adjusters determine car accident settlement amounts can help you estimate the compensation you may receive.
What are the Legal Requirements for UIM Coverage in California?
Under the California Insurance Code §11580.1b, drivers must meet the following minimum liability insurance requirements:
- $30,000 for injuries or the loss of life of a single individual.
- $60,000 for injuries or fatalities involving multiple individuals in a single accident.
- $15,000 for property damage resulting from an accident.
California does not require drivers to carry UIM insurance. While it is not required, it is highly recommended that you carry UIM insurance to ensure sufficient coverage if you are in an accident and not at fault.
Many drivers wonder, is California a no-fault state? The answer is no—California follows a fault-based system, which directly impacts UIM claims.
Liability coverage is designed to compensate third parties for injuries or property damage caused by the insured driver. Comprehensive and collision insurance do not fulfill California's financial responsibility requirements. Additional coverage for commercial or fleet vehicles may be required as mandated by federal, state, or local regulations.
Key California Insurance Code Sections Governing UIM Coverage:
- Section 11580.2 – Mandates that auto insurers offer Uninsured/Underinsured Motorist (UM/UIM) coverage unless the policyholder explicitly declines it in writing. It also outlines conditions for eligibility.
- Section 11580.26 – Addresses Uninsured Motorist Property Damage (UMPD) coverage, requiring insurers to protect against property damage caused by uninsured motorists. If a policyholder does not carry collision coverage, UMPD may offer up to $3,500 in compensation for vehicle damage.
What are the Benefits of Underinsured Motorist Coverage?
- Financial Security: Protects policyholders when the at-fault driver's liability insurance is insufficient to cover damages, ensuring that accident-related costs are not a personal financial burden.
- Medical Expense Coverage: Helps pay for emergency medical care, hospital bills, physical therapy, rehabilitation, and long-term treatment resulting from the accident.
- Compensation for Lost Wages: Provides financial relief if injuries prevent you from working, covering lost income and helping maintain financial stability during recovery.
- Non-Economic Damages: Covers intangible losses such as pain, suffering, emotional distress, and diminished quality of life following a severe accident.
- Legal and Settlement Support: Ensures fair compensation in cases where insurance companies may attempt to undervalue claims, often requiring legal negotiation.
How to File an Underinsured Motorist Claim in California?
Step 1: Verify the At-Fault Driver's Insurance Coverage
- Request a declaration page from their insurance provider.
- Confirm that the at-fault driver's liability limits are fully exhausted before proceeding with a claim.
Step 2: Notify Your Insurance Company Promptly
- Contact your insurer immediately to report the accident and initiate a UIM claim.
- Submit essential documentation, including medical reports, police records, and property damage estimates.
Step 3: Consult a Personal Injury Attorney
Insurance companies may undervalue or delay UIM claims to minimize payouts. An experienced personal injury lawyer can advocate on your behalf and negotiate for a fair settlement.
Step 4: Negotiate and Finalize Your Settlement
Review policy payout limits to understand the maximum compensation available. If your claim is denied or undervalued, explore alternative dispute resolution options such as mediation, arbitration, or filing a lawsuit to seek the compensation you deserve.
Before filing your claim, it's important to avoid common mistakes after a car accident, which can negatively impact your settlement.
What are the Common Challenges in UIM Claims & How to Overcome Them?
Filing an underinsured motorist (UIM) claim might seem straightforward, but many people face unexpected challenges. Insurance companies have strict rules and don't always make it easy to get the money you deserve. Here are some common problems people encounter when filing a UIM claim and simple ways to overcome them.
Delayed or Denied Claims:
Sometimes, insurance companies will argue that the at-fault driver had enough coverage and refuse to pay your claim. This can cause long delays or even outright denials.
Solution: Keep strong records of your accident, medical bills, lost wages, and pain or suffering. The more proof you have, the harder it will be for the insurance company to deny your claim. Also, save copies of all emails and letters you receive from them.
Disputes Overcompensation Amount:
Insurance companies often try to pay you less than what damages are worth. They may offer a low settlement, hoping you'll accept it without a fight.
Solution: If an insurer offers you less than you deserve, don't settle immediately. A personal injury attorney can help determine the actual value of your claim and negotiate on your behalf to ensure you get fair compensation.
Strict Deadlines for Filing a UIM Claim:
In California, you must file a UIM claim within two years of the accident, but some policies may have even shorter deadlines.
Solution: As soon as you learn that the at-fault driver's insurance isn't enough, start the claims process immediately. Notify your insurance company and consider speaking with an attorney to ensure you don't miss any critical deadlines.
FAQs About Underinsured Motorist Claims in California
Is underinsured motorist coverage mandatory in California?
No, California law does not require drivers to carry underinsured motorist coverage. However, insurers are obligated to offer it, and policyholders must reject it in writing if they choose not to include it in their policy.
How can an insured lower their UIM coverage limits?
Policyholders who wish to lower their underinsured motorist coverage limits must submit a formal request to their insurance provider, typically in writing. It is important to review potential financial risks before opting for reduced limits.
Can I combine multiple UIM policies for higher coverage?
No, California does not allow policy stacking for underinsured motorist coverage. Policyholders are limited to the coverage amount specified in their policy for each insured vehicle.
Does UIM coverage apply to hit-and-run accidents?
Underinsured motorist coverage may apply to hit-and-run accidents if the at-fault driver is unidentified. Policyholders should report the accident promptly and provide supporting documentation to their insurer.
What is the recommended amount for uninsured motorist bodily injury (BI) coverage?
Experts recommend carrying at least $100,000 per person and $300,000 per accident to ensure sufficient protection in the event of a serious accident involving an underinsured driver.
Injured by an Underinsured Driver? Get the Compensation You Are Owed Today!
Review your current insurance policy limits and ensure you have adequate coverage.
Contact a personal injury attorney at Fassonaki Law Firm, P.C., to maximize your claim and secure the compensation you deserve. Our experienced legal team specializes in underinsured motorist claims, ensuring that insurance companies pay what you own.
Don't wait! If you've been involved in an accident with an underinsured driver, act now to protect your financial future. Schedule a FREE consultation with Fassonaki Law Firm, P.C. today! Call us at 323-524-8994 to speak with an expert attorney who will fight for your rights.
