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Auto Insurance in Massachusetts: Why You Need Excess Coverage for Bodily Injury, Uninsured Motorists and Underinsured Motorists

To register an automobile in Massachusetts, the vehicle owner must purchase certain insurance policies for the car, but Bay State motorists should seriously consider purchasing excess coverage to protect themselves.insurance

Massachusetts General Law Chapter 175 section 113L requires that all motor vehicle insurance policies sold to owners to cover vehicles registered in Massachusetts must include coverage for bodily injury to others (BI), and coverage for bodily injury caused by an uninsured automobile or motorist (UM).

As a registered car owner, what have you purchased? When you have been in an accident, what do these policies cover?

What Is Bodily Injury Coverage?

Bodily injury coverage (BI) provides for payment of expenses and pain and suffering to someone else who is injured if you cause a motor vehicle accident.  BI insurance will pay the expenses you are legally responsible for, because the accident occurred due to your actions.  BI insurance protects you and your assets because if you cause an accident, you do not have to pay out of your own pocket up to the amount of insurance you purchased.

What is Uninsured Motorist Coverage?

Uninsured motorist coverage (UM) provides coverage for expenses and pain and suffering that the insured and others sustain when they are injured due to the negligence of an uninsured or even an unidentified hit-and-run motorist.  The UM insurance you purchase and pay for will make a payout to you as long as you are legally entitled to recover from the owner or operator of the uninsured or hit and run automobile.

Who is Covered?

Uninsured motorist coverage (UM) provides coverage to you or any household member while occupying your automobile, while occupying an automobile that you do not own, or, if injured as a pedestrian.  Also covered are others injured while occupying your car.  A household member is defined as anyone living in your household who is related to you by blood, marriage, or adoption.  This includes wards, step children  or foster children.

What Are the Minimum Coverage Amounts?

For both types of required insurance coverage, the Massachusetts legislature set a minimum level of monetary coverage that a car owner must purchase.  In Massachusetts the bare minimum a BI policy must cover, or be able payout, is up to $20,000 per person up to $40,000 per accident. The UM policy must also cover, or be able to pay out, up to $20,000 per person and $40,000 in total per accident.

In other words, if either of these policies were triggered to make a pay out, your insurer could pay up to $20,000 for one person's pain and suffering and expenses, and up to $40,000 in total for injuries to more than one person.  The most a minimum policy purchase would pay out in any one accident is $40,000 in total. When an accident is your fault, and BI insurance is involved, if you purchased the minimum required, after $20,000 (or $40,000 depending on the scenario) you may be personally liable for any additional expenses to the injured party. After the insurance company exhausts your policy, an injured party might be able to sue you personally to cover any additional expenses.  Similarly, in the case of UM, if you sustain serious injury and your policy tops out at $20,000 per person, but your bills for treatment are high and your expenses and claim for pain and suffering are more than $20,000.00, then you will have to find another source to collect what you are owed.

Why Purchasing Excess Coverage Makes Sense

It is important when you are purchasing car insurance to consider what amount of coverage you really want or need.  While purchasing higher amounts of insurance may cost you more per month, you may decide the extra expense is worth it to you.  Taking into consideration the cost of health care and peace of mind, many drivers find the minimum amount of coverage is simply not enough.

Consider this example that illustrates the importance of purchasing excess coverage: You are sitting at a red traffic light at a Boston intersection in your lawfully registered car when you get hit from the back by a speeding, uninsured car that did not slow or stop for the light.  You sustain serious injuries in the accident and your medical bills are well over $100,000.

If the driver had no insurance, your UM policy will cover your pain and suffering claim. If you have purchased the minimum requirement of insurance, you only will be paid up to $20,000 for your damages, despite having medical bills alone that exceed $100,000.  The additional costs might be recovered if you are able to sue the other driver and the other driver has assets.

But what if the at fault driver has little or no assets?  Your insurance has been exhausted, and tens of thousands of dollars is left for you to pay even though you were innocently for waiting a traffic light to change when you were hit. Had you purchased a larger policy and paid a little more per month, insurance could have come to your aid and taken one headache away from this unfortunate accident.

Or say you cause an accident.  You are driving home after a long shift at work. You accidentally close your eyes and fall asleep for a few moments while you travel down a two lane roadway.  In that instant you hit another car coming in the opposite direction and cause a critical injury to the other driver.  His medical bills reach $75,000 and are climbing.  If you have the minimum insurance, it is possible your coverage will payout only $20,000 to the injured party.  How will the other $55,000 plus be paid?  You may be sued personally to make you pay the gap in coverage and expense.  You could end up in a position where you need to sell assets to pay the remaining medical bills for injuries you caused. Had you purchased a higher amount of insurance, the damages you owe could be covered by insurance.

Choosing Coverage 

When you first register your car, a car owner can purchase insurance that satisfies the state minimum, but the car owner will have the option to buy more insurance that will cover more costs for an additional monthly premium or bill.  Insurance rates are determined on a personal basis.  Each insurance company will consider many factors to determine a price - age of the driver, length of years licensed, year and make of car being insured, driving history and place where the car is principally garaged are just a few of the factors considered by the insurance companies.  A premium, or cost per month, for each level of coverage is established and offered. Each month the registered car owner pays the insurance company the premium, and in return the insurance company will pay up to these amounts if you are in an accident, suffer injury and or otherwise need to make a claim.

A car owner will likely find a range of prices from an assortment of insurers.  It is important to shop around and to read the fine print.

When a driver is young and registers his first car, it may be the case that he does not have many assets that he is worried might be reached in a lawsuit resulting from an accident should insurance not cover all damages.  A 21-year-old man insuring his first car will likely not worry so much about having inadequate insurance in case of causing an accident since he does not yet own a home or have other assets.  But as drivers age they also usually have more assets they would like to protect and to make sure they won't be needed to cover any costs. Often older adults choose higher automobile coverage amounts as they find it worth an increased monthly premium to protect larger assets.  But these higher amounts of coverage are available to anyone.

It is difficult to provide exact figures for insurance premiums as each policy is fitted and priced for each person's profile and choices.  Some common coverage amounts for BI and UM are the minimum $20,000 per person and $40,000 maximum per accident as one policy example, and $100,000 per person and up to $300,000 per accident as a second example policy.

In general terms, the cost difference in moving from the lowest coverage to coverage more able to protect you and your loved ones in the event of a bad crash, for instance $100,000.00 per person/$300,000.00 per accident, is minimal given the greater protection purchased.

A Closer Look at Underinsured Motor Vehicle Insurance Coverage

While BI and UM policies are requirements for valid Massachusetts car registration, it is likely any driver would also want Underinsured Motor Vehicle insurance (UIM) even though it is not a requirement in Massachusetts. Underinsured motorist coverage (UIM) provides coverage for losses that the insured and others sustain when they are injured due to the negligence of a motorist who has some liability insurance, but the limit of that insurance is insufficient to pay for all the damages.

UIM will thus also make a payout to you, the policyholder, as well as household members, if you suffer injuries and incur expenses beyond the maximum payout of the other driver's insurance policy. While UIM is not a required insurance in Massachusetts, this sort of policy is routinely offered in the Commonwealth. In fact, such insurance is so desirable it is actually included in the above scenario of cost comparison as UIM inclusion in coverage is commonplace and is almost always coupled with UM by the insurance companies. UIM insurance can provide needed money to fill a gap between the amount of insurance another driver chose to purchase and what treatment of your injuries actually costs.

The Big Picture 

Choosing an amount of Bodily Injury, Uninsured Motorist or Underinsured Motorist insurance is a personal choice.  It is important you choose a policy within your budget, but it is important to think not only of your budget now, but your budget and assets should you be in an accident and either cause or suffer injury.  It is easy to look at the day-to-day expense and feel like a higher level insurance is money thrown to the wind.  That is, until an accident happens and you need to be covered and need healthcare bills to be paid.  While the numbers for insurance premiums may be dizzying, one thing remains constant: It is important for you to purchase that amount of insurance that covers you and your family in time of need, protects your assets, covers your expenses, and hopefully gives you peace of mind.

If you were injured or a loved one was injured or died in an accident involving an uninsured or underinsured motorist, contact the Law Offices of Mark E. Salomone. Call 1-800-WIN-WIN-1. Boston attorneys can help you explore your options and hold any and all negligent parties accountable.

Atty. Mark Bixby is a personal injury lawyer at the Law Offices of Mark E. Salomone, serving Springfield and throughout Massachusetts. If you or a loved one has been injured, contact our law firm today.