Arizona, like some states, requires $15,000.00 per person/$30,000.00 per accident liability insurance ($10,000.00 for property damage). This is often referred to as "the state minimum." This means that if you cause an accident, the maximum amount that the person who was injured due to your negligence would be able to recover from your insurance company would be $15,000.00 for their injuries. If there were 3 or more people in the car, the most that all individuals combined could recover is $30,000.00. Because of the speed, size and number of vehicles on the road, it often results that individuals injured in car accidents sustain injuries far above the state minimum required coverage. At that point, you become personally liable for the remainder. If you have any assets (a home, cars, savings/checking accounts, etc.), state minimum coverage is NOT for you.
I recently spoke with a large insurance company to get price estimates on the cost to increase insurance coverage and additional estimates to add important additional coverage that should be added by most drivers. Note that these estimates are for an adult with no health reservations and a good driving record with an existing policy of $100,000.00/$300,000.00 ($100k per person and $300k per accident).
Uninsured and Under Insured Coverage
Uninsured (UM) and Under Insured (UIM) insurance covers you in the event that a person who causes a car accident in which you are injured has little or no liability insurance. UIM insurance is design to take the place or "step into the shoes" of the at-fault person who had no insurance or not enough insurance. Because the state minimum is only $15,000.00 per person, it is often the case that your injuries are going to exceed $15,000.00. Further, it would be a mistake to assume that the at-fault person has enough money in the bank or assets to make up the difference. As of 2006, more than 1 in 5 drivers in Arizona were driving Uninsured. How many "insured" drivers are driving Under Insured? It is a risky proposition each and every time that we get behind the wheel.
To add UIM/UM coverage to a $100,000.00/$300.000.00 policy described above, I was given the quote of $9.50 per month. This would allow for me to have an additional $100,000.00 for my own injuries above and beyond the at fault party's insurance.
Medical Payments Coverage
Medical Payments (Med Pay) coverage is a provision available on auto insurance policies that allows for payment of "reasonable" medical expenses caused as a result of a car accident. Most Med Pay provisions allow for coverage in increments of $5,000.00. In Arizona, the Med Pay coverage is particularly enticing. Many states require that if you obtain a personal injury settlement related to your car accident, then you must pay back the Medical Payment coverage to your auto insurance. In Arizona, that is not the case. By statute, Arizona has determined that the first $5,000.00 does not have to be reimbursed to the auto insurance company.
To add $5,000.00 of Med Pay to the policy discussed above, I was given the quote of approximately $6.00/month.
Increase Your CoverageIncreasing your auto insurance coverage can also be a very reasonable thing to do. For example, to increase your coverage from $100,000.00/$300,000.00 to $250,000.00/$500,000.00 was approximately $6.00/month.
Navigating the insurance waters after your car accident is something I do everyday.
Adam W. Barlow, Esq.
Adam Barlow Law, P.C.