Many car accident victims come to my office with an accident report in their hands revealing that the driver at fault had insufficient or no liability insurance. The injured victim usually asks: “How can these people drive around without adequate insurance limits?” But when I ask to see the victim’s insurance policy, we usually learn that the victim also has the same inadequate auto liability coverage limits, with inadequate uninsured or underinsured motorist coverage. As a result, the coverage is frequently insufficient provide fair compensation for the huge medical bills, lost wages, and the victim’s pain, suffering and disability.
“No problem, I have an umbrella policy”, the accident victim declares. But when we check their umbrella insurance policy, we frequently learn that their umbrella does not apply to their uninsured or underinsured motorist coverage; it only provides additional protection for their own negligent driving.
A separate premium must be paid to link the umbrella coverage to the uninsured and underinsured motorist coverage. It is usually less than $500 for this endorsement. A recent court case made clear that a