Types Of Insurance For Personal Injury Cases
Liability Insurance — Section 303.025, RSMo. requires that the owner of a motor vehicle registered in this state (or required to be registered) must maintain financial responsibility for the vehicle. Without financial responsibility, the motor vehicle owner may not operate, or permit another person to operate, any vehicle.
There are multiple ways to maintain financial responsibility, and the easiest is Liability insurance. Liability insurance provides coverage to pay damages you cause to another person through your inadvertence when operating your vehicle.
Section 303.030, RSMo. (and Section 379.203, RSMo.) provide that no Liability insurance policy is effective unless it provides coverage of not less than twenty‑five thousand dollars because of bodily injury to, or death of, one person in any one accident. In addition, the Liability insurance policy must also provide coverage of not less than fifty thousand dollars because of bodily injury to, or death of, two or more persons in any one accident.
While twenty five thousand dollars is the minimum requirement, medical treatment is very expensive and can quickly exceed twenty five thousand dollars. Your insurance company is only required to pay any judgment entered against you up to the Liability insurance coverage limits, and not more. If any judgment entered against you in Court happens to exceed your Liability insurance limits, then you are personally responsible to pay the excess judgment over and above your coverage.
While minimum Liability insurance is mandatory (it is a crime not to carry Liability coverage), you have the option to purchase more coverage than the minimum.
Given that a judgment in excess of your insurance coverage puts your own assets at risk, you should give strong consideration to purchasing more than the minimum twenty five thousand dollars in Liability insurance coverage.
Uninsured Motorist — Section 379.203, RSMo. also provides that no automobile liability insurance shall be delivered unless it also carries mandatory Uninsured Motorist (sometimes called UM) coverage in the same minimum limits of twenty five thousand dollars.
Like Liability coverage, Uninsured Motorist is mandatory insurance. However, the purpose is different. Uninsured Motorist insurance applies in the situation where the other driver has no insurance at all. In essence, Uninsured Motorist coverage amounts to you purchasing coverage for the other driver who is at fault — but who failed to comply with the law and buy Liability insurance.
Like liability coverage, Uninsured Motorist coverage minimums are a requirement, but you have the option of purchasing additional Uninsured Motorist coverage. Given that the cost of medical treatment can easily exceed twenty five thousand dollars in Uninsured Motorist coverage, you should give strong consideration to purchasing more than the minimum coverage.
Underinsured Motorist — Unlike Liability insurance and Uninsured Motorist insurance, both of which have mandatory minimums, other optional insurance coverages are available to deal with personal injuries. One such insurance type is Underinsured Motorist coverage (sometimes called UIM).
Underinsured Motorist coverage applies in the situation where an at-fault driver does carry Liability insurance, but does not carry enough Liability insurance to pay all your damages. In essence, Underinsured Motorist coverage amounts to you purchasing additional or excess coverage for the other driver who is at fault — enough to pay your damages.
Given that the cost of medical treatment can easily exceed twenty five thousand dollars in Liability coverage, you should give strong consideration to purchasing your own Underinsured Motorist insurance.
Umbrella — Another optional form of insurance is a type of Liability coverage called Umbrella coverage. Umbrella coverage is a single policy that extends Liability insurance to all vehicles, boats, and land, providing an additional level of insurance covering all.
Generally, Umbrella coverage will require you to carry liability insurance policies on all vehicles, boats, real estate, etc. Once those base coverages are in place, a single Umbrella policy can be purchased that will provide excess Liability coverage over and above the base coverages. A single Umbrella insurance policy is purchased, and it provides excess Liability coverage over all vehicles, boats, real estate, etc. that has underlying Liability coverage.
Some insurance carriers also sell Uninsured Motorist and Underinsured Motorist endorsements under an Umbrella policy, extending those coverages to all vehicles as well as Liability coverage.
Given the low cost of Umbrella, and given that judgments can easily exceed twenty five thousand dollars in Liability or Uninsured Motorist coverage, you should give strong consideration to purchasing an Umbrella policy with an Uninsured Motorist and an Underinsured Motorist endorsement.
Medical Payments — Missouri has very few no-fault insurance provisions applicable to auto accidents. One common exception is Medical Payments Coverage (sometimes called MedPay), which will often make payment for medical bills arising from the ownership, use or maintenance of an automobile without regard to fault or liability.
Even if you have health insurance, medical treatments are not always covered. Commonly, you will have to pay out-of-pocket expenses including co-pays, deductibles, and other non-covered treatments or medications.
Given the low cost of Medical Payments coverage, you should give strong consideration to purchasing Medical Payments coverage to help pay co-pays, deductibles and other non-covered items.
Accidental Death & Dismemberment — Although not commonly purchased, some insurance carriers also offer AD&D (Accidental Death & Dismemberment) coverage. AD&D coverage will provide additional payments (over and above Liability, Uninsured Motorist, Uninsured Motorist, etc) in the event of a death or a permanent dismemberment occurring in your vehicle as a result of a collision. Each policy defines “dismemberment” in a different manner.
AD&D coverage is generally not very expensive. Although not common, some people supplement their other insurance coverages (and their life insurance) by purchasing AD&D coverage as part of their automobile insurance package.
Summary — The details of how Liability, Uninsured Motorist, Underinsured Motorist, Umbrella, Medical Payments, and AD&D coverages work are separate subjects that are addressed in different articles in this series on automobile insurance coverages.
Above all, keep in mind that none of these insurance coverages function exactly the same as the rest. Underinsured Motorist coverages do not work exactly like Liability or Uninsured Motorist coverages. In addition, policies are all written differently by each carrier, and the details about coverages differ. You should have an experienced Rolla personal injury attorney review all your automobile policies in advance, and advise you on how to best protect yourself in the event you are in a collision.
By: Joseph W. Rigler
DID YOU KNOW? is presented by Williams, Robinson, Rigler & Buschjost, PC as a public information service only. None of the information contained herein is intended to be taken as legal advice. Each matter depends on unique facts which attorneys must consider in forming an opinion, and may depend on laws unique to a particular jurisdiction. No two cases are the same. If you want to know more about this subject, contact Williams, Robinson, Rigler & Buschjost, PC, or the attorney of your choice, and seek a formal opinion about your particular case.
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