It is important to understand the various types of automobile insurance coverages so that you can purchase the appropriate types and amounts of coverage needed to fully protect you and your family in the event of an vehicle accident. This article will focus on the types of automobile insurance coverages related to physical injuries, not property damage.
LIABILITY COVERAGE: If you cause a wreck and injure others, then you owe those whom you injured compensation for their harms and losses, such as medical expenses, lost wages, permanent injury, physical pain and mental suffering, scarring, etc. Automobile liability coverage pays that money for you. Before this coverage gets paid to someone else, either your insurance company must acknowledge that you caused the wreck, or you must have been determined at-fault in court. The minimum required liability coverage amount for most automobiles in North Carolina is referred to as “minimum limits”: $30,000 per person/$60,000 per accident. However, with medical costs being as high as they are, the minimum $30,000 liability policy is often insufficient to fully protect you if you seriously injure someone else. In the event that you have insufficient liability coverage amounts to fully compensate those that you injured, then you would owe the remainder personally. Therefore, I recommend that you purchase a minimum of $100,000 per person/$300,000 per accident. This would mean that if you cause a wreck and injure other(s), then you have $100,000 of coverage to pay to any one person and $300,000 total to pay to everyone injured a wreck, in the event that more than one person is injured.
MEDICAL PAYMENTS COVERAGE: This is a voluntary, no-fault coverage that benefits you by paying money to you if you incur medical bills related to a wreck, regardless of who caused the wreck. Typically, you can purchase $1,000, $2,000, $5,000 or $10,000 worth of “med. pay.” coverage. Once you incur medical expenses and present those bills to your automobile insurance company, then your automobile insurance company writes you a check for the full amount of the original bill, or up to the amount of your “med. pay.” coverage limits, whichever is less. Practically, this money comes in handy if you are in a wreck and have to pay 1) health insurance co-pays or deductibles, 2) vehicle repairs, 3) a new vehicle down payment, and/or 4) ordinary bills if you are out-of-work due to injuries.
UNINSURED/UNDERINSURED MOTORIST COVERAGE: This is perhaps the most important, and usually cheapest, coverage that you should purchase. Uninsured motorist (UM) coverage protects you by paying you for your harms and losses if someone else caused the wreck and injured you but that person did not have any automobile insurance, i.e., uninsured. Underinsured motorist coverage applies if that other person did not have enough automobile insurance to fully compensate you, i.e., underinsured. UM/UIM coverage can be purchased up to $1,000,000.00, typically for just a few hundred dollars per year. UM/UIM coverage not only protects you, but it also protects any relative who was residing with you on the date of the wreck, regardless of what vehicle he/she was in when injured, whether owned by you or not, whether covered under your automobile policy or not, and even if he/she was injured by a vehicle while riding a bike or while walking. As you can see, this is very important coverage to protect you and your family.
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Danny Glover, Jr.
Glover Law Firm
406 S. Griffin St., Suite B
Elizabeth City, N.C. 27909
Types of Automobile Insurance -- by Danny Glover
Reviewed by kensunm
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Reviewed by kensunm
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