Uninsured motorist bodily injury coverage

What is the difference between Uninsured Motorist and Bodily Injury coverage

What are the 2 car insurance coverages that you must have?

Uninsured Motorist Bodily Injury Coverage is required by Colorado Law

In Colorado, every driver must carry Uninsured motorist bodily injury coverage and with regard to just bodily injury coverage, it is a legal requirement in the state of Colorado. Colorado requires everyone, every person who drives a vehicle to purchase Bodily Injury Coverage. Uninsured Motorist coverage is not a required coverage in Colorado, but I highly recommend that everyone purchase Uninsured/Underinsured Motorist coverage and I will tell you why later in this article.

What is the required amount of bodily injury coverage in Colorado?

 By law, everyone must carry at least $25,000.00 in bodily injury coverage per individual and $50,000.00 per accident and $15,000.00 per accident for property damage. These are the minimum requirements in Colorado. However, I always encourage everyone to carry more uninsured motorist bodily injury coverage. If you can afford to pay just a little more for these types of coverages, then it will be well worth the added protection when you are the cause of a car accident.

Mandatory Automobile Insurance in Colorado

Automobile owners in Colorado are required to carry liability insurance.  Liability insurance covers bodily injury to another person or property damage to another’s vehicle or property when the insured is at fault for an accident.  The following minimum coverages are required by the state, although higher coverages may be purchased and should be purchased. According to the Colorado General Assembly:

  • $25,000 for bodily injury or death to any one person in an accident;
  • $50,000 for bodily injury or death to all persons in any one accident; and
  • $15,000 for property damage in any one accident. 

Self insurance

Any individual who has over 25 vehicles registered to his or her name may qualify as a self-insurer by applying for a certificate of self-insurance from the state Insurance Commissioner.  The Insurance Commissioner must ensure that the individual will be able to pay the minimum coverages required by the state.  For more information on selfinsurance, contact the state’s Division of Insurance within the Department of Regulatory Agencies (DORA).

How does uninsured motorist bodily injury coverage help you when involved in a car accident?

In the world of car insurance, there are two coverages that are very important for everyone to have. Number one, you should always purchase bodily injury coverage when you purchase your car insurance. Bodily Injury insurance covers you if you are at fault in causing an accident and you cause personal injuries to another driver, passengers, bicyclist, pedestrian, etc. The more bodily injury insurance you can afford, the more protection you will have against any potential lawsuits.

Example of Uninsured motorist bodily injury coverage in a car accident.

As an example of uninsured motorist bodily injury coverage, let’s say you are negligent and slam into the rear of a car in front of you at a stop light. You will be deemed at fault for this car accident. Uninsured motorist bodily injury coverage, specifically bodily injury coverage will help protect you against a lawsuit. The driver you slammed into, will most certainly bring a claim against your insurance company. The insurance company will “step into your shoes” and defend you, up to the amount of you uninsured bodily injury coverage. So, if you carry the minimum in bodily injury coverage, or $25,000.00, then the insurance company will defend you up to $25,000.00 and will attempt to get your case settled within your bodily injury policy limits.

However, in the above factual scenario, what if the driver you hit require major surgery at a cost well over $25,000.00? In this unfortunate situation, the insurance company may not be able to totally protect you as the other driver’s damages/medical bills will exceed $25,000.00. Thus, the other driver may choose to file a direct lawsuit against you in order to recover money against you personally. This is a danger you can prevent. How can you prevent this scenario? Purchase higher limits of bodily injury coverage and you can even purchase an Umbrella add on which will additionally cover you for say $1 Million Dollars. One Million Dollars in extra umbrella insurance is relatively cheap and can cost from $200-400 per year. It is a well paid for addition and umbrella of coverage if someone is making a claim against your uninsured motorist bodily injury coverage. 

The more assets you have, the more uninsured motorist bodily injury coverage that you should purchase.

In Colorado, for example, the state requires everyone to carry a minimum bodily injury insurance (BI) of $25,000/$50,000. This is merely a minimum and the more money and assets you have to protect, the more BI coverage you should purchase. A major lawsuit can wipe out your assets, so to protect yourself from financial ruin, please purchase as much uninsured motorist bodily injury coverage as you can afford. You will thank me when involved in a serious accident. With so many more cars on the roads and so much texting and distracted driving, the more uninsured motorist bodily injury coverage you have, the better protected you will be. 

If you have no real assets, then you may be able to get away with purchasing the minimum coverage of $25,000/$50,000. By the way, the $25,000 covers you if you injure one person and the $50,000 covers you if you injure more than 1 person. So, if you crash into 5 cyclists on the side of the road and injure all of them, $50,000 is the most money that your insurance company will pay out on your behalf. People who live paycheck to paycheck are not always able to purchase more than the minimum state coverage as they have to prioritize their budgets among rent, food, insurance, etc.

Is Uninsured/Underinsured mandatory in the State of Colorado?

You are not required to purchase Uninsured Motorist coverage in the state of Colorado, but your insurance agent is required to offer it to you and you can accept it or decline it. With regard to Uninsured Motorist or Underinsured Motorist coverage, this is another important car insurance coverage that you should purchase. 

Example of car accident with uninsured motorist

Let’s say you get hit by an uninsured driver. The uninsured driver is usually of lower income as he is apparently not able to pay the extra insurance for this uninsured motorist bodily injury coverage. Or a driver could be uninsured because he let his insurance expire and did not renew it, or he or she is just driving without any insurance because he or she cannot afford it and needs to eat and pay the rent before he can every purchase car insurance. 

A knowledgeable and experienced personal injury lawyer will also advise you on the different types of insurance that can impact you in case you are the victim of a vehicular accident. 

Of particular note is uninsured motorist insurance, which is explained in detail below.

UNINSURED MOTORIST BODILY INJURY COVERAGE IN COLORADO

In Colorado, drivers are only required to have $25,000 as liability coverage – which isn’t a lot considering the worst-case scenario in a vehicular accident. So if you’re out driving, always keep a mindset that every other driver out there can only give you $25,000 in case they cause an accident and you’re the victim.

Of course, it’s entirely possible that other people have more coverage than $25,000. However, the majority of drivers would only have $25,000 in liability coverage. This also becomes far less reassuring when you know that an estimated 13.3% of drivers in Colorado are uninsured.

Implications of the $25,000 Liability Coverage

If you happen to become the victim of a car accident caused by someone who only has the required $25,000 in liability coverage, it is likely you’ll only receive the same to cover any property damage and medical expenses.

While $25,000 is a lot of money if you’re thinking of shopping or travel expenses, it doesn’t really amount to much if your vehicle is badly damaged and your hospitalization costs are high.

This is where purchasing uninsured motorist coverage (UIM) can significantly help, as having this insurance will help cover your expenses when you are the victim of a vehicular accident.

Although getting UIM may seem unfair to you, as you’ll be paying out of pocket for the added protection, you need to be realistic about the way things are. Most insured drivers will only have $25,000 in liability coverage.

Do I need UIM if I already have health insurance?

Remember that health insurance does not cover property damage costs, such as a wrecked vehicle and any other possessions you had with you during the accident. This means that if you had a laptop, cellphone, tablet or some other high-value item with you during the accident, health insurance wouldn’t be any help. If you have UIM, you can recover the costs of those items.

If you have copays or health insurance deductibles, these can add more financial stress while you are undergoing treatment. However, your UIM will cover those. In case you need treatment that isn’t covered by your health insurance, your UIM can also take care of those. Alternative or complementary treatments such as going to the chiropractor will be covered.

If I have full coverage, would a UIM be useful?

The term “full coverage” is quite misleading because there really is no such thing. You might be saying you have all the insurance the state of Colorado requires. However, having all the required insurance doesn’t mean you won’t incur any more costs in case you cause or fall victim to an accident. What you actually have is the minimum coverage required in the state of Colorado.

For better protection, you need to have more than the minimum insurance required. Most people do not, and remember, there are drivers on the road who have zero insurance. So, in case any of these people ends up hitting your vehicle, causing property damage and injuries in the process, your so-called full coverage won’t be much help.

Your liability coverage won’t pay for all your bills. Even if you have a good collision coverage, it won’t help pay your medical bills. UIM will help with both property damage and medical expenses.

What protection do liability, collision and comprehensive coverage give?

  • Liability coverage: This type of car insurance pays for damages and injuries to another person resulting from an accident you caused. It doesn’t cover any of your expenses resulting from the accident.
  • Collision coverage: Collision car insurance covers the cost of repair or replacement needed for damage to your vehicle caused by a crash with another vehicle or a stationary object, such as an electrical pole, streetlight or tree. It won’t cover any of your medical expenses resulting from the crash.
  • Comprehensive coverage: Largely a misnomer, comprehensive car insurance only covers damages to your car that are not caused by a collision. It typically applies to force majeure or “acts of God or nature,” which are usually beyond your control. Examples of these would be accidentally hitting a deer that came out of nowhere, getting your vehicle carjacked or bad road conditions due to heavy snow or a hailstorm.

What happens when you are injured due to the fault of an uninsured motorist? 

If you are injured in a car accident due to the fault of an uninsured motorist, then you have to hope that you did purchase Uninsured Motorist with your car insurance company and did not sign a waiver declining this very important coverage. 

Uninsured/Underinsured motorist coverage is not required in Colorado, as stated above, but your insurance agent is required to offer it to you. Does that mean you should not purchase it? No. You should definitely purchase this type of car insurance coverage and have your insurance agent thoroughly explain this coverage to you. 

Getting back to an example of an Uninsured motorist, an uninsured motorist injures you in a car accident and he or she is definitely at fault. What can you do? You need to make an immediate claim against your own car insurance carrier for payment of your damages with your uninsured motorist coverage. You would need an experienced car accident attorney to make this claim for you as it can be complicated. If you have $25,000.00 in Uninsured motorist coverage, then that is the limit that you can recover for your injuries against your own insurance company. If you are wise enough to purchase more coverage, say $100,000.00, then $100,000.00 would be the limit that you could settle for with your own insurance coverage. 

PURCHASE UNINSURED MOTORIST COVERAGE, AS MUCH AS YOU CAN!

What happens when you are struck by an Underinsured Motorist?

As opposed to a totally uninsured car driver, let’s say the at-fault driver does have uninsured motorist bodily injury coverage. As an example, the at-fault driver carries the Colorado state minimum of $25,000 in bodily injury coverage. This bodily injury coverage may certainly cover a “whiplash” type injury so there would be no problem in a relatively minor, soft-tissue injury case as you would be able to settle your case within that $25,000.

However, let’s say that your injuries are more severe. You may have broken bones or a traumatic brain injury. Your case will exceed the value of the at-fault driver’s $25,000 in bodily injury coverage. What do you do in this scenario? Luckily, you purchased Underinsured motorist coverage so you can settle your case for the underlying $25,000 and then go after your own insurance company for your benefits under Underinsured coverage, uninsured motorist bodily injury coverage. However, if you did not purchase uninsured/underinsured motorist coverage then you are out of luck and will be stuck with receiving the at-fault driver’s $25,000 in bodily injury coverage.

These issues can be very complicated, when dealing with which coverages are available and what is your maximum possible recovery for your injuries, medical bills, pain and suffering and loss of enjoyment of life. I have more than 27 years of experience dealing with all types of car insurance coverage and I have been through all these issues and problems. I know how to deal with all these minefields and am happy to answer any questions you may have on insurance coverage issue. If you have a questions about uninsured motorist bodily injury coverage, please call or email me.