Motorcycle Insurance: Uninsured and Underinsured Motorist Coverage

[Administrator]

Original Article:
Motorcycle Insurance: Uninsured and Underinsured Motorist Coverage

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[The_AirHawk]

Kirk, I am still a bit corn-fuzzed here: So, how much Un/Under should one purchase? Obviously, the minimum will be maxed about 13-minutes after any crash, the Max you could get will drain Bill Gates dry, but what should one aim-for as a "Happy Medium"?

Yeah, I know, I know.........

[acecycleins]

I typically ask customers to match the limits of liability and the UM. You shouldn't consider yourself to be of less value than the rest of the things you are trying to protect.

[Lobo_1]

Correct me if I am wrong here but uninsured motorist protection is redundant if you already have health insurance. Maybe for younger riders that don't have good health insurance through work or elect to carry it on their own it is useful but for those that do have it they will be covered through their health plan and this option is basically double coverage.

[12er]

Originally Posted by Lobo_1

Correct me if I am wrong here but uninsured motorist protection is redundant if you already have health insurance. Maybe for younger riders that don't have good health insurance through work or elect to carry it on their own it is useful but for those that do have it they will be covered through their health plan and this option is basically double coverage.

Not an expert but have used my UM. When a lovely 7 months preggers young lady with no License or Insurance ran a red light about 30mph above the speedlimit and T-boned me my UM covered my losses. Basically my insurance paid my claim and then sued her for the loss. So while medical luckily was 7 months of chiro, it covered the damage to my car without me having to sue her directly.

[acecycleins]

Originally Posted by Lobo_1

Correct me if I am wrong here but uninsured motorist protection is redundant if you already have health insurance. Maybe for younger riders that don't have good health insurance through work or elect to carry it on their own it is useful but for those that do have it they will be covered through their health plan and this option is basically double coverage.

Incorrect. You are confusing UM coverage with Medical Payments coverage. Med pay on bikes will only go to $10k for most companies. Tell me- when was the last time you or a hurt friend came out under the $10k mark in an accident that involves bodily injury? Uninsured motorist is your way to make sure that if you are the victim you have a back up in case the at-fault party doesn't have enough insurance to cover your medical bills. Additionally, it's your way to fix your bike and it not effect your premiums as a collision claim through the property damage portion.
I don't trist arms to get people to buy uninsured motorist coverage, but when you consider that 1/3rd of all drivers lack insurance the fact is that you are riding while surrounded by the uninsured. Just sayin....

[The_AirHawk]

Originally Posted by acecycleins

when you consider that 1/3rd of all drivers lack insurance the fact is that you are riding while surrounded by the uninsured. Just sayin....

Seriously? You think it's that high of a percentage?

Wow, with every state now having instituted a Liability Law; I would have thought it would have curbed the practice of "running free" quite handily.

[acecycleins]

Originally Posted by The_AirHawk

Seriously? You think it's that high of a percentage?

Wow, with every state now having instituted a Liability Law; I would have thought it would have curbed the practice of "running free" quite handily.

It's an insurance industry statistical fact.

[Duken4evr]

Excellent article! I have been a Auto BI (and property) claims adjuster for 23 years now. I agree with the author. He obviously is in the business and knows what he is talking about. A few comments:

1) Yes, the percentage of uninsured drivers on the road really is that high.

Most states have some sort of scheme that requires proof of insurance to register a vehicle, but this is easily circumvented. People buy month to month policies, get the proof form, register their car, then quit paying. It is illegal, but it is actually a valid financial decision if you are a financial turnip and no blood can be squeezed from you. If someone has no assets and no wages to garnish, you can sue them all you want and get nowhere. From their perspective, that auto insurance money has to be used to buy gas and pay the rent.

There has been an idea proposed to assist with this. An small "insurance tax" on gas that would be used to provide minimum liability coverage limits. Theoretically a good idea perhaps, but it would create another inefficient gov't bureaucracy I suppose.

2) Since the economy went down the tubes, I have noticed a definitive trend. ERs "light em up" with expensive diagnostic MRI, CT scans, etc. Why? Because there is a greater chance of recovery in a vehicle accident scenario, with potential health, auto and auto liability insurance avenues of recovery. It has nothing to do with medical concerns. That is my jaded view anyway! ERs typically have a "super lien" which means they are statutorily protected and they can hound you until the end of time to get paid. Medical bills are said to be the #1 cause of bankruptcy in the US.

3) When working with an adjuster on your property damage and bodily injury claims, don't go to an attorney unless you have reasonably exhausted all avenues of discussion. Unfortunately, sometimes you may get an adjuster who has 300 files on their backlog. They don't have time for you and it shows in their responsiveness.

On a side note, this is a stupid practice by the industry. Overwork the hell out of the financial gatekeepers is not a good idea. Any money saved in wages is lost several times over in mistakes and flat out overpayments to move routine claims. Tougher big $ claims don't get the attention they need as the handler does not have time for them. Such positions are the definition of "cubicle hell" and they are common in the industry.

On the other hand, I settled a UM policy limit case last week for $300,000 with no attorney. That means that insured gets 100% of the money He had a bad knee injury, but that recent college grad is getting one hell of a good financial start in life. Smart kid too - aeronautical engineering is a tough degree. I work for Amica which is has been rated #1 for 10 years in a row for customer service by JD Power. I am busy for sure , but I have enough time so I can focus on the tough claims.

There are times a good attorney can save the day. When the medical bills are way more than the coverage available, a good attorney can work with the hospitals, health insurers, etc, to get them down. I had a case with a woman who was hit by my insured. We had a $500,000 policy limit. Problem was, she was in a coma for weeks and when she came out, she lost most of her mental capacity. Her medical bills were 750K and she had no health insurance. Her attorney got the medical center to waive all the bills and we used the 500K to set up a special needs trust. She was and still is in a nursing home now. I have had fatality cases, this one was worse. She lived. My insured was going 100mph when she hit that poor woman.

Avoid any attorney who advertises on TV or via billboards. They are inevitably "mill operations". There are very good "real" attorneys who are out there. It takes a bit more work to find them but it is worth the effort.

4) For anyone living in Colorado who may read this - CO is perhaps unique with it's motorcycle UM coverage. It "stacks" on top of your auto coverage. The standard CO UM endorsement form for bikes does not exclude "vehicles with fewer than 4 wheels". I just settled a UD (underinsured) case for 200 grand on our insured's auto policy. She got hit on her bike and got the 25K minimum from the responsible driver, 25K from Progressive, her bike insurer, and 200K from me, her auto insurer. She was busted up with some fractures, but is fine now. As a CO resident, my strategy is to carry 500K UM coverage on my auto policy because it is cheaper to buy it there. Nice to be protected in the car and peace of mind on the bike.

Typically, policies do not "stack", which means the amount available to you under your UM coverage is reduced by the amounts you receive from the responsible driver. In other words, if you have, say, $100,000 in UM coverage and the responsible driver has $100,000 in liability and you receive that, you are not eligible to make a "underinsured" claim.

In CO, you would receive the 100K from the responsible driver and another 100K for a total of $200,000, assuming your injuries are significant. CO is a good place to be for injured parties. Florida also does it this way. Florida is insurance hell though!

Oh well, so much to say, this is my career after all. I will stop here

[WARPrints]

Originally Posted by The_AirHawk

Seriously? You think it's that high of a percentage?

Wow, with every state now having instituted a Liability Law; I would have thought it would have curbed the practice of "running free" quite handily.

Just as the author assumed that the trial attorney was saying high limits was best simply because it was good for the attorney's 1/3 fee, keep in mind that the author is an agent who makes money selling insurance, and UM, for a bike, is the MOST expensive element. What's good for the goose ...

Also - keep in mind that UM pays not only medical, but also general damages, and if you are laid up for 4 months, you may be entitled to lost wages.

What would I recommend for UM coverage - the same as that darned attorney and the dang insurance agent. BTW - I am an insurance defense attorney. So now you have almost all angles recommending high UM limits.