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Increase to insurance minimums nice, but enough to protect injured victims

posted by Christian Ashin & Brown on: 10/04/11 in category: Auto Insurance | tags:

In early February 2010, Maryland House Bill 825 passed and went into effect for all motorists purchasing or renewing their car insurance policies after Jan. 1, 2011. This, the first adjustment to these requirements since the law was enacted in 1972, is great news and we have already seen the positive effects for our clients.

The new bill requires Maryland motorists to carry minimum liability coverage of $30,000 per person/$60,000 per accident compared to the current requirement of $20,000/$40,000. That extra $10,000 can really make a difference for our clients. Unfortunately, in most cases it is still not enough.

As citizens, we rely on the legislature to protect us, but we can only rely on them to an extent. The insurance industry spends a lot of money on lobbyists to do whatever they can to keep these minimum policies as low as possible. This is where you need to protect yourself. After all, an insurance contract is a contract between you (the insured) and the company (the insurer).

When you review the declaration sheet of your insurance policy, it is imperative to make sure that you are protected in case you are the victim of another motorist’s negligence. It is unwise to rely on that negligent motorist to have adequate insurance to compensate you for your injuries. The law now requires them to have $30,000/$60,000, which is a nice increase from $20,000/$40,000, as discussed above, but hardly enough to compensate someone who is seriously injured.

To make sure that you are protected, we recommend increasing your Uninsured/Underinsured motorist benefits to at least $250,000 per individual, $500,000 per accident. The first number represents the maximum amount the insurance company will pay per individual, while the second number represents the maximum amount the company will pay per accident, if there are multiple injured parties. Please note that some policies differ based on the company that you use, and purchasing even more coverage is never a bad idea.

For example, if you are seriously injured by someone with a $30,000 policy (referred to as a minimum policy) you are still protected by your own company’s policy because you were smart enough to pay a small amount more per year to protect yourself. Now, once the negligent driver’s company pays their policy maximum of $30,000, you can turn to your company to get the difference in what your claim is worth. Your company then has the right to attempt to collect from the negligent driver what it paid out to you. Your insurance rates will not be affected by filing an uninsured motorist claim.

Multiple times a year we are faced with the unfortunate experience of having to explain to a client that their case is only worth $30,000. Don’t get me wrong; that’s better than $20,000, and we’re thrilled with the change in the law. But for an innocent victim who has multiple broken bones and hundreds of thousands of dollars in medical expenses, it is not nearly enough. Do yourself a favor, and check your policy to make sure you are protected. 

If you have been injured and think that you may have a claim, please call for a free consultation with an experienced attorney 301-277-9171.

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Alan Fawcett, Esq.

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