Basics of Insurance – Part II

In my last post, I provided a summary of the types of auto insurance that often come into play during a personal injury case. In this post, I will outline some important auto insurance laws in Virginia and what you can do to protect yourself in case you are injured.

The Virginia Code (the statutes enacted by the legislature) contains minimum coverage requirements for insurance policies. Each policy must have $25,000/$50,000/$20,000 in liability coverage. See Code § 46.2-472. (Remember from the last post that this means $25K for personal injuries per person, $50K for personal injuries per accident, and $20K for property damage per accident.)

Virginia drivers can opt out of the insurance requirements by paying a $500 fee. See Code § 46.2-706. Importantly, the fees that are collected are not used to compensate drivers in accidents with individuals who are not insured. Instead, if you are injured during an auto accident and the wrongdoer has paid the fee and opted out of the insurance requirements, then your recourse is to sue the wrongdoer and try to collect on any judgment obtained against him/her. If the wrongdoer didn’t want to purchase insurance, what are the chances he/she will have assets through which you could collect a judgment?

The reality is that someone could seriously injure you while having minimal (or no) insurance available to compensate you for your injuries. The best way to protect yourself from this risk is through uninsured/underinsured coverage. The Code requires every insurance policy in Virginia to have such coverage. See Code § 38.2-2206. The caveat, however, is that you cannot load up uninsured/underinsured coverage while having minimal liability coverage. Instead, the Code provides that you may not have more uninsured/underinsured coverage than you have liability coverage. See id.

Unfortunately, we routinely meet with people who have inadequate uninsured/underinsured coverage and are hurt by a wrongdoer with minimal insurance. Those people are left with few options, if any, to actually collect for all their injuries against the wrongdoer.

To protect yourself against being in this situation if you are ever injured, look into increasing your uninsured/underinsured coverage. Although increasing your limits will cost more, you may be surprised at how little your cost rises. Often, it only costs a few dollars per month to increase your coverage by hundreds-of-thousands of dollars. (Remember, the expensive part of insurance is the first $25K in coverage.) At the very least, it’s worth a phone call or email to check your options.

Until next time, safe driving!

Matt Perushek
Check out my attorney profile at our firm’s website.