Insurance For Crossing The Street
As a plaintiffs’ personal injury attorney, and former claims adjuster, I have analyzed accident litigation from just about every angle. I have seen too many cases where people were catastrophically injured in a car accident, and the at-fault driver didn’t have nearly enough insurance coverage, or was uninsured. In New York, automobile owners are only required to carry $25,000 of liability insurance. Many cars in New York have just this amount.
On numerous occasions, I have had to break the news to clients, who had been severely hurt, that the most they could possibly receive was $25,000 for the lifetime of pain and suffering that surely awaited them.
Of course, the best way to protect oneself against this possibility is to have a large uninsured motorist/underinsured motorist coverage limit in your auto policy. The UM/SUM coverage covers you if you are in an accident with someone who is either uninsured, or who doesn’t carry enough insurance to compensate you for your injuries. In the event of such an accident, the insured, or resident relative of the insured, makes a first party claim against his or her own policy. (Generally, a resident relative of a named insured can make a claim for UM/SUM benefits.) The UM/SUM carrier then steps into the shoes of the uninsured or underinsured vehicle and litigates the case against the claimant. The claimant can either arbitrate, or file a lawsuit against the insurance company. Regardless of whether the full value of the policy is ultimately awarded, the claimant at least has the possibility of obtaining compensation, whereas, without such policy, no such chance would exist.
As a longtime Manhattan resident, who does not own a car, I had often lamented my inability to buy this essential protection. It seems that almost every day I am nearly run over in a crosswalk, and the cabs or Uber vehicles in which I often ride seem to cheat death at every turn. I have felt myself wishing I could own a car — just to get a large UM/SUM limit. Then I learned about the most important insurance policy I had never heard of: The Named Non-Owner’s Auto Policy. This is car insurance for people who don’t own cars.
The insurance industry typically markets these policies only to people who frequently rent or borrow cars, have personal assets of their own, and don’t want to buy additional third party liability insurance each time a car is rented or borrowed. However, this type of policy is ideal for Manhattan residents, regardless of their personal assets, because of its built-in UM/SUM coverage. After doing extensive research, I found a carrier who wrote me a policy with a $2 million limit for a premium of only about $500 per year. This is for liability and UM/SUM. (I couldn’t find a carrier who would write more UM/SUM than liability and $2 million was the highest policy amount I could find).
For the seriously paranoid
Is $2 million enough to cover your injuries? For those of us who have been in this business long enough, we realize that $2 million may, in fact, not be enough to cover the damages from a serious accident. The solution? Umbrella coverage with an endorsement. Many people are under the mistaken impression that their umbrella policy covers uninsured motorist/underinsured motorist. This is generally not true. A standard, unendorsed ISO form umbrella policy, does not cover UM/SUM. However, many carriers will permit an endorsement adding at least another $1 million layer of coverage specifically for UM/SUM. This is the best bet for those who are seriously worried about being seriously injured and getting seriously compensated.
If you don’t own a car, and don’t live in a household with someone who owns a car, you are taking your financial future in your hands every time you cross the street, ride in a car, or drive one. The only way to ensure you may be covered, in the event of an accident, is through the purchase of a named non-owner’s auto policy (preferably with an endorsed umbrella on top).
This article originally appeared on Coverage Opinions.