Car Insurance? Don’t Expect the Other Guy to Have Enough. Insure Yourself!
We budget everything from rent to mortgage, gas, groceries-you name it. Given the fact that our taxes and insurance are so high people in New Jersey need to be better at budgeting than do citizens elsewhere. Unfortunately, when it comes to car insurance too many people are “penny wise & pound foolish”. So many clients, family and friends by the cheapest car insurance that, in actuality, provides them with no real protection. They want to satisfy the requirement of having insurance without considering the protection that they are buying. Low premiums do not equal good coverage.
Car insurance has roughly 3 basic components. LIABILITY coverage is when you cause the accident and someone is making a claim against you. PIP coverage is your coverage for medical bills that you incur under the NJ “no fault” scheme. UM/UIM (uninsured/underinsured) coverage is what you rely upon if you are injured and the other guy doesn’t have coverage or enough coverage. All too often people cheat themselves by selecting car insurance coverage that doesn’t provide them with enough insurance for MEDICAL BILLS and UM/UIM coverage.
Two weeks ago the NJ Supreme Court ruled in a case known as HAINES v. TAFT an injured motorist could NOT purse unpaid medical bills from the person who caused the accident if the injured person didn’t have enough PIP coverage (no fault medical bills coverage). For example, if you had a policy with only $15,000 in PIP (medical bill) coverage, which is one of the cheapest, and you incurred $40,000 in medical bills, the injured person was stuck with the other $25,000 in bills! You must, in this day and age have sufficient PIP (medical bill) coverage. Choose the $250,000 PIP coverage.
UM/UIM coverage works the same. If the other guy who caused the accident that injures you only has a policy limit with $50,000 that may be all you can get. What if your injuries are 5x that amount? Where will it come from? Nowhere, unless you have sufficient UM/UIM coverage. For example, if you have UM/UIM coverage of $50,000 and the other guy as the same-yours is worthless because you are not uninsured. If you have $100,000 and the other guy has $50,000 you could qualify for $100,000 ($50,000 from his policy and $50,000 from your own UM/UIM).
The moral of the story is that in matters of car insurance-you have to protect yourself. Do not look to the other guy. In my firm we get every visitor a pamphlet that describes these important legal issues. We are so strong on this point that ANYONE can receive a FREE appointment to see how important these features really are and to take one of our brochures. Protect yourself!