What happens if you are a passenger in someone else’s car, and you are injured by another party who does not have enough insurance?
In this recent case, Progressive Choice Ins. Vs. Calif. State Automobile Inter-Insurance (CSAA)(2013), the court helped answer this question. Here Progressive was insuring the car in which the plaintiff was a passenger (you in the question posed above). In addition, this same plaintiff had his own automobile insurance with CSAA. The person that caused the accident did not have enough insurance. The wrong doer only had $25,000 of insurance coverage. The plaintiff’s injury was worth far more than this.
Luckily for the injured passenger/plaintiff, the car that he was in had Underinsured Motorist (referred to as UIM) coverage in the amount of $100,000 with Progressive. In addition, the passenger/plaintiff had his own automobile insurance with CSAA, and he also had UIM coverage in the amount of $50,000.
What amount was the passenger entitled to under the 2 UIM policies? Was he entitled to the remaining coverage under the $100,000 (or $75,000 since he had already received $25,000), or was he entitled to the remaining coverage under the $50,000 policy (or $25,000). And were both Progressive and CSAA responsible?
The court concluded that the passenger was entitled to avail himself to the higher of the 2 UIM policies, and therefore collect $75,000. And both Progressive and CSAA had to share in this payment, on a pro rata basis. This would mean the Progressive would pay $50,000 and CSAA would pay $25,000, since Progressive’s UIM policy was twice as large as CSAA’s UIM policy.
I cannot stress enough the importance of having plenty of UM and UIM coverage. Too often we have seen a client receive very significant injuries, but the person who caused the injuries either has no insurance, or very little insurance. With UM (Uninsured Motorist) and UIM (Underinsured Motorist) coverage the injured person has a much better chance of being fully compensated for his or her injuries.
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