With the economy slumping and job losses mounting, more and more people are dirving without car insurance. Acccording to a recent Wall Street Journal article, several hundred thousand drivers dropped their insurance in the past year as the jobless rate climbed, estimates a study to be released next month by the Insurance Research Council, an industry-funded group. Online agency Insurance.com says it also is seeing evidence recently of more uninsured motorists. It says that as many as 40% of callers following up on online applications had let their previous policies lapse, up from less than 10% a couple years ago.
What does this mean for Connecticut motorists? It is more important than ever to make sure that you are fully insured in the event that you are injured in a car collision by someone without or with little insurance coverage. This means that, at a minimum, ever motorist should have at least $300,000 in uninsured and underinsured motorists benefits coverage. For even better security, ever motorist should double his or her uninsured and underinsured coverage and obtain conversion. Conversion has been explained in an earlier personal injury blog post.
Under Connecticut law, everyone who has car insurance has uninsured/underinsured motorist benefits coverage. What most people do not know is how much coverage the underinsured motorist coverage provides. If you suffer personal injuries in a car accident caused by the negligence of the other driver, you are entitled to be compensated by the other driver’s insurance company. In many instances, the negligent driver has inadequate insurance. Typically, the person has a 20,000/40,000 policy. This means that the negligent driver has a total of $20,000 in insurance coverage to compensate you for your injuries and losses. In most cases, $20,000 will not fairly and justly compensate the person. This is why underinsurance coverage is so important. Using the example above, once the negligent driver’s insurance company pays the $20,000, the only other realistic source for additional compensation comes from your underinsurance coverage. The amount of underinsurance coverage available to you will be dictacted by the terms of your insurance company. If for example, you have standard uninsured/underinsurance coverage in the amount of 100,000/300,000, you would have a total of $80,000 in underinsurance coverage. You have $80,000 in coverage and not $100,000 because the negligent driver had $20,000 in coverage. This is what many people do not understand. Your underinsurance coverage only kicks in if your coverage exceeds the liability limits of the negligent driver’s insurance policy. If you have a 20/40 policy and the negligent driver has a 20/40 policy, you do not have underinsurance coverage for that car accident.
However, this can be rectified verry easily and for little additional cost. It is called conversion coverage. Insurance companies doing business in Connecticut are required to offer conversion coverage. Conversion coverage works as follows: If you are hit by a negligent driver who has a 100/300 policy and you have underinsurance coverage of 100/300 with conversion, you will have a total of $200,000 in available insurance to compensate you for your injuries (100,000 from the negligent driver and 100,000 from your insurance policy). Without conversion, you would only have the 100,000 from the negligent driver. The additional cost for conversion coverage is nominal and the benefits of the coverage can not be emphasized enough. If you do not presently have conversion coverage, contact your insurance company and get it. The lawyers at Sabatini & Associates have unfortunately seen too many cases where the injured person has been undercompensated due to a lack of sufficient insurance coverage.