UIM or underinsured motorist coverage is probably one of the most commonly misunderstood types of car accident insurance coverage available in Delaware. In fact, many Delaware residents who are injured in car, truck or pedestrian accidents often have no idea what UIM is, let alone whether they even purchased this important coverage on their auto insurance policies.
It cannot be stated any more simply than this: UIM coverage in Delaware is optional, but is one of the most critical types of coverage. The unfortunate reality is that many Delaware residents opt out of UIM coverage on their auto insurance policies. This is a huge mistake.
UIM coverage protects you in the event you get into an accident caused by another driver who does not have enough auto insurance coverage.
Hypothetical – How UIM Works in a Delaware Car Accident Case
Picture this scenario: You are driving in downtown Wilmington and get t-boned by someone who runs a red light. Your injuries are quite serious. You need major medical treatment including multiple surgeries, and the injuries prevent you from returning to work for several months. The at-fault driver is covered under a basic auto insurance policy which carries the state-required minimum: only $15,000 of liability coverage, also known as bodily injury coverage. This liability coverage is what kicks in to provide you with financial compensation from the at-fault driver. The limit however, is only $15,000.
You file a car accident lawsuit against the at-fault driver and seek to recover $15,000 under his liability policy. In this situation, the at-fault driver has no tangible assets; therefore this is the maximum amount you can recover from the at-fault driver.
If you elected UIM coverage on your own auto insurance policy, you could make a claim for UIM benefits with your own insurance company. That’s the nature of UIM coverage; UIM claims operate like contract claims. You have a contractual agreement with your auto insurance company. It agrees to provide UIM coverage in exchange for your premiums. Therefore, when you’re injured in a car, truck or pedestrian accident due to no fault of your own, you may make a claim for UIM benefits. This depends on important factors like the amount of liability coverage under the at-fault driver’s policy and other factors like the nature and extent of your injuries.
In the example above, the at-fault driver only has the $15,000 liability limit, and your injuries are quite serious. If you purchased UIM coverage, you would likely be able to make a UIM claim. For example, if you purchased $50,000 of UIM coverage, you could make a claim for up to $50,000 of UIM benefits. Basically, UIM coverage provides an extra source of compensation in the event of a major car accident which is caused by another person.
It is important to note that UIM law in Delaware changed significantly this past year, for all policies issued or renewed after January 3, 2014. Prior to the amendment, Delaware courts would only allow a car accident victim to make a UIM claim if their UIM limit was higher than the liability limit of the at-fault driver. In the scenario above, under the old version of the law, you would be able to make a UIM claim (i.e., because your $50,000 UIM limit exceeds the $15,000 liability limit of the at-fault driver). However, if you had elected $15,000 of UIM coverage, the old law would have prevented you from being allowed to make a UIM claim.
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