I don't know how many times I have asked a client who has been in an accident what kind of insurance they have and they state they have " Full Coverage". This term has no legal significance. If you go to an insurance agent and ask for this you will get whatever the agent chooses to call "full coverage", this usually is the minimum coverage available, which is not what the client thinks. Before buying automobile insurance in Pennsylvania you should be familiar with the following terms:
Full Tort vs. Limited Tort:
Since the 90's you have been able to choose between full tort or limited tort coverage when purchasing automobile insurance. With " full tort" if you are injured in an automobile accident and the other party is at fault, then you have your full legal rights and can pursue the other party for any and all types of injuries and damages.
For a reduced premium you may choose " limited tort" coverage. With " limited tort" you give up your rights to pursue the other party for pain and suffering except in certain instances (i.e. defendant driver DUI, defendant driver operating vehicle registered in another state). You may also be able to recover if you sustain a "serious bodily injury". Unfortunately, there is no definition of "serious bodily injury" and insurance companies are known to take a fairly hard line as to what qualifies as a "serious bodily injury". You should also know that your tort selection can be binding on the other members of your family that reside with you, for example your spouse or children.
I know no attorney who would advise a client to choose limited tort when purchasing automobile insurance. You are giving up way too much for too little reduction in premium. If you have limited tort call you agent and ask the difference in premium amount to increase the coverage to "full tort".
Underinsured/Uninsured Coverage:
Underinsured/Uninsured coverage is optional coverage that you can purchase to protect yourself from other drivers who are either driving without insurance (uninsured) or who are covered by a policy which is too small to compensate you for your injuries (underinsured). Maybe an example will help. Lets say you were hurt in an accident and sustained major injuries. The driver of the other vehicle only has $15,000 in liability coverage (which is the legal minimum in Pennsylvania). This driver would be underinsured for your injuries. If you did not purchase underinsured motorist coverage that would probably be the extent of recovery from this accident. However, if in our example you purchased $100,000 in underinsured motorist coverage, you would be able to make a claim on your own insurance policy for an additional $100,000. Giving you a potential recovery of $115,000.
In Pennsylvania you can choose to purchase Underinsured/Uninsured motorist coverage that equals your liability coverage or you can choose to waive that right or purchase amounts lower than your liability coverage. However in waiving or lowering your coverage amounts remember you will be covering other people better than yourself.
Another term to be familiar with in determining your underinsured/uninsured coverage is "stacking". If you choose "stacking" you can increase the amount of coverage that you have by the number of vehicles on the policy. In the example above, if you had three vehicles on your policy and chose stacking you would have $300,000.00 in underinsured coverage available. Stacking can become a very complicated issue depending on the policy language and the various policies that come into play. However, for basic coverage, you need to know that stacking will increase your underinsured/uninsured coverage by the number of vehicles on that policy.
Lost Wage Coverage:
This form of coverage is not automatically included on your policy, it must be requested by you. If you are injured in an accident the responsible party will not pay for your lost wages while you recover. A typical lost policy will provide $1,000/$5,000 in coverage. If you are hurt in an accident and a doctor states you can't work you could then receive a maximum of $1,000 per month in lost wages for 5 months. In determining your lost wages, most insurance policies will give you 80% of your lost wages up to your monthly maximum.
If you have questions about your insurance coverage, contact us before you get in an accident. Don't find out too late that you didn't have enough coverage to protect your self and your family.We will gladly discuss your insurance coverage with you at no cost to you.
