W^H? The Holmes Murphy Blog

  • Avoiding the Grinch Named ‘A Negligent Driver with No Auto Insurance’

    This holiday season, what could be worse than a visit from the Grinch or bumping into Scrooge out in the streets? I can safely answer that question. How about a non-fault automobile accident where the negligent driver does not have enough, or any, liability coverage? This situation could leave your business or you personally financial responsible for the accident.

    Unlike a visit from the Grinch or bumping into Scrooge, this type of automobile accident is commonplace in today’s world. A recent report from the Insurance Research Council showed that 13 percent of drivers are uninsured. Countrywide, that equates to about one in eight drivers out on the roads who are uninsured. This doesn’t factor into the number of drivers who don’t have enough liability coverage.

    With an average of 6 million automobile accidents a year, with 3 million of those accidents resulting in injury, the likelihood of having an accident with an uninsured driver is high. So, what can be done to protect your business and protect yourself from this potential financial risk should you get hit by an uninsured motorist or someone with insufficient coverage?

    The solution — Uninsured Motorists (UM) and Underinsured Motorists (UIM) is the insurance coverage needed to protect your business and you personally from these types of exposures on the road. Uninsured and Underinsured Motorists are separate but similar coverages. Depending on the state, these coverages can be on separate policy forms or combined on the same insurance form.

    Uninsured Motorists is coverage for bodily injury and, in some states property damage, incurred by an insured because of an uninsured negligent driver. Examples of an uninsured diver is someone who doesn’t have any insurance or insurance that doesn’t meet specific state minimum requirements.

    Underinsured Motorists is coverage for bodily injury and, in some states property damage, incurred by an insured because of an underinsured negligent driver. An example of an underinsured driver is when the at-fault driver has insurance coverage too low to cover your expenses. If the other driver has too low insurance and you sustain serious injuries, the available insurance benefits to you may not be enough to cover all your medical expenses.

    Now the question becomes, “Do you need Uninsured Motorist and Uninsured Motorist coverage?” The answer is simple…”Yes!” In some state’s Uninsured and Underinsured Motorist is a required insurance coverage and, as laid out before, unfortunately, there are a lot of uninsured motorists on the road even though most all states require drivers to maintain automobile insurance. Uninsured and Underinsured Motorist coverage is a relatively inexpensive way to protect your business and you personally from significant financial responsibility caused from injuries by a negligent uninsured or underinsured driver.

    With the holidays here, you don’t need the added stress of worrying about other drivers on the road who aren’t insured properly. Contact your insurance experts at Holmes Murphy to make sure your business and you personally are covered for these situations that may arise. We can tackle your questions about having the appropriate coverage limits for your business and any costs associated with the coverages.

    Published on: 12.21.17

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    • Kevin Duggan

      Kylee, good advice for the small business and definitely on personal lines. I carry UM/UIM limits equal to my BI limits on my personal auto policy. Which also means I get the max available on my personal coverage (250/500 last I checked) because then I have the same limit for UM/UIM at a very nominal cost. And then my personal umbrella on top of that. It is cheaper at the 100/300 limits but then my UM/UIM is lower for me and my family. Which didn’t make sense to me for the nominal difference.
      For the larger client you may not want any UM/UIM coverage (or state minimums if required) for their employees. It can be a shock for the UI/UIM claim to have future effects on their premiums when the client thought WC was the sole coverage available. You can always add the UM/UIM separately for the owner/family members so they have coverage. But the larger the insured the greater the need to have that discussion with them. The employee can pick up coverage on their personal UM/UIM if the WC doesn’t provide all the compensation they feel is needed.