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What Is Uninsured/Underinsured Motorist Coverage?

What is uninsured/underinsured motorist coverage? Uninsured and underinsured motorist coverage provides compensation from your insurance company if the person responsible for the accident does not have enough insurance to cover the damages or does not have an insurance policy. To better understand this type of coverage, it’s important to have a good understanding of how auto insurance works. You can recover compensation in an accident that involves an uninsured/underinsured motorist by making a claim with your own insurer, and it may be necessary to first file a lawsuit against the at-fault driver.

 Even though many states require motorists to carry an insurance policy, there are over 20 million drivers that do not carry insurance. In those instances where the at fault driver does have insurance, it is often not enough to fully cover the loss the victim is entitled to. As a result, there is a higher chance that the accident will be resolved through your own insurance company.

How Car Accident Claims Work Where There is No or Not Enough Insurance Coverage

One way to safeguard yourself against financial loss is having enough uninsured/underinsured coverage with your own auto insurance. When you purchase insurance in Illinois, you are entitled to have uninsured/underinsured coverage at least equal to your own liability policy limit. If you are injured in an automobile collision you may be entitled to various elements of damages ranging from medical expenses, lost wages and compensation for disability, loss of normal life including past and future pain and suffering. If the at fault driver does not have enough liability insurance to cover what you would be entitled to, you can turn to your own insurance company for the difference, up to the amount of limits you purchased for uninsured/underinsured coverage. In essence, your insurance company becomes the at fault driver’s insurer and takes an adversarial role against you, their own insured. Your own insurance company may argue that you are at least in part at fault for the accident, or argue that your damages are less than they actually are. They will do what they can to minimize paying what they should. It is therefore very important that you consult an attorney before you give any detailed information to your own insurance company when you first notify your insurance company about the accident.

There are certain things that may affect your ability to secure fair compensation. It helps to understand how can car accident kits help you prove your injury case. Likewise, it is also essential to keep aware of what people should and should not say after an accident, as this may impact the success of your claim. 

If a driver is the cause of an accident, his or her insurance company will compensate you for your losses. However, if the driver does not have insurance coverage or enough coverage, that driver will be held personally responsible for paying any damages incurred. However, it is likely that the at fault driver does not have sufficient assets to pay those damages, leaving your sole remedy a claim against your insurance company pursuant to the uninsured/underinsured provisions of your policy. A car accident attorney can help you to recover damages from an uninsured or underinsured driver through a lawsuit, arbitration or a settlement agreement.

Legal Requirements for Automobile Insurance in Illinois

If  a person owns or operates a motor vehicle in Illinois, it is mandatory to have liability insurance. This insurance covers damage to property or injuries that one may cause others as a result of an accident, as per Illinois law. To comply with the law, you must have liability insurance in the following minimum amounts:

  • $25,000 for the injury or death of one person in an accident.
  • $50,000 for the injury or death of more than one person in an accident.
  • $20,000 for property damage.

Insurance companies are required to offer uninsured/underinsured coverage with at least the same minimum coverage limits.

Financial Responsibility for Damages

In Illinois, if you are involved in a car accident, the driver who caused the accident is held responsible for any property damages and injuries. This is known as a fault-based auto liability legal system. The driver who caused the accident can be held liable for monetary damages to the injured parties through an auto insurance claim or personal injury lawsuit.

A driver is considered at fault when his or her actions or negligence caused the accident. The at-fault driver is then responsible for both economic and non-economic damages caused to the victims. These damages include medical expenses, loss of income, past and future pain and suffering, and loss of enjoyment of life, disability, disfigurement, among others.

Illinois follows the comparative negligence law for accidents involving multiple drivers. If the injured person is found to be less than 50% responsible for the damages, that person can recover damages. However, if he or she is found to be 1-49% responsible, the amount of damages recoverable will be reduced by the percentage of fault. This same principle is applied to the insured seeking compensation from their own insurance company pursuant to the uninsured/underinsured provisions or their policy. Therefore, it is important to contact an attorney as early as possible.

How UM/UIM Claims Can Help After a Hit and Run Accident

UM (Uninsured Motorist) and UIM (Underinsured Motorist) claims can be invaluable after a hit-and-run accident. An accident is considered a hit-and-run when the responsible driver leaves the scene without providing his or her contact information or insurance details. Every accident should be reported to the police, even if you initially believe only property damage is involved. In hit-and-run cases, most insurance policies require proof of physical contact with the offending vehicle. 

This is where UM and UIM coverage can be beneficial:

  • Compensation for Injuries: UM coverage provides compensation for your injuries when the at-fault driver is either uninsured or cannot be identified. UIM coverage kicks in when the at-fault driver has insurance, but his or her coverage limits are insufficient to cover your damages.
  • Covering Medical Bills: UM/UIM coverage can help pay for your medical expenses, including hospital bills, doctor’s visits, surgery, rehabilitation, and more. These costs can add up quickly, and UM/UIM can alleviate the financial burden.
  • Loss of Income: If your injuries result in time off work, UM/UIM insurance can help compensate for lost wages, ensuring you have a source of income during your recovery.
  • Non Economic Losses: UM/UIM coverage can compensate you for past and future pain and suffering, and loss of enjoyment of life, disability, disfigurement, among other elements.
  • Hit and Run Incidents: UM coverage is specifically designed to cover hit-and-run accidents where the at-fault driver cannot be identified or located. Without UM coverage, you might be left with no way to recover damages in such a situation.

Knowing that you have UM/UIM coverage can provide peace of mind, as you’re protected in case you encounter an uninsured or underinsured driver, or you’re involved in a hit-and-run incident.

Available Options for Accident Victims

What happens if someone without insurance hits you? Seeking compensation for your injuries can be challenging, but is not impossible. There are two main options you can consider.

Pursuing Legal Action Against the At-Fault Driver

In case of an accident, you may opt to sue the responsible driver and seek compensation from his insurance company and/ or their personal assets. However, it’s possible that the responsible party does not have sufficient funds to provide you with the compensation. In this case, you may secure a judgment that may take years to recover through wage garnishment proceedings and if the judgment is large enough the responsible party may simply discharge their debt in bankruptcy. Accordingly, UM/UIM coverage is often the only realistic option.

Using Uninsured/Underinsured Motorist Coverage

After an accident where the responsible driver has insufficient insurance coverage and is unable to pay for all the damages, you would need to turn to your uninsured/underinsured motorist coverage to compensate for the shortfall.

It is crucial to file a claim promptly after getting involved in a collision with an uninsured or underinsured driver to ensure that you have filed your claim within all required timeframes set forth in your insurance policy. Failure to make a timely claim in the form required by your policy may bar you from collecting. This can be difficult depending on the language in your policy. It is therefore important to seek the advice of an attorney before you do anything.

UM/UIM coverage only pays for losses arising from bodily injury. Property damage is not covered by this provision and is dealt with separately under different sections of your policy.

UM/UIM claims are handled differently than lawsuits against the at fault driver. If your injury arises from a collision with an uninsured driver or hit and run incident and you and your attorney can not settle the claim because your insurance company refuses to pay what fair compensation is, the matter will usually be resolved by arbitration. In an arbitration, a panel of lawyers selected by your attorney and the insurance company lawyer will decide what is fair based on a review of records and an abbreviated hearing that usually is held in one day. This is a fairly expedient manner of resolving the conflict with your insurance company without going to court.

If your injury arises from a collision with an insured driver who does not have sufficient insurance to cover what you are entitled to, the underinsured provisions often don’t get triggered until a lawsuit is filed against the at fault driver and the full extent of the available insurance coverages are determined. If all the available at fault driver insurance is offered as settlement, and it is determined by your attorney that it is insufficient to cover your loss there will be a demand made on your behalf under your underinsured policy provision. If that is the case the matter will proceed as mentioned above and proceed to arbitration if necessary.

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