According to most sources, approximately 10-12% of Nevada motorists are uninsured. The majority of Nevada motorists carry low limits of BI coverage. You can protect yourself from the losses and costs associated with injuries caused by other motorists by purchasing uninsured/underinsured motorist coverage as part of your automobile insurance policy. That coverage is commonly known as UM/UIM coverage.
The discussions below regarding accidents involving uninsured motorists apply to accidents involving underinsured motorists as well.
Uninsured motorist coverage protects you in the event that you are involved in an accident with an uninsured driver. It provides no protection for property damage (NOTE: Some companies offer uninsured motorists property damage coverage), but it does provide for recovery in the event you are injured by an uninsured driver. This coverage will reimburse you for your reasonable and necessary medical expenses (Special Damages) caused by an uninsured motorist. It will also reimburse you for general damages (pain and suffering) and wage loss caused by the uninsured motorist. Uninsured motorist coverage is represented by two (2) numbers on your auto insurance policy. These numbers are the same as what you see on your bodily injury liability coverage. Coverages are generally as follows: 15/30; 25/50; 50/100; 100/300; and, $300,000.00 single limits. The first number is the “per person” limit, and the second number represents the “per accident” limit. These coverages are often designated as UM coverage (uninsured motorists coverage) and UIM coverage (underinsurance coverage).
By Statute in Nevada, if you have uninsured motorist coverage, you also have underinsurance coverage. Underinsurance coverage means that, in the event your damages exceed the at-fault driver’s bodily injury liability limits, your underinsurance coverage will pick-up where the adverse driver’s liability coverage ends. For example, if your injury claim is worth $30,000.00, and the adverse driver has a 15/30 bodily injury liability coverage, and you have 15/30 underinsurance coverage, you will be fully compensated for the value of your claim. In this example, if your injury claim is worth $100,000.00, you will only be paid $15,000.00 by the adverse carrier and $15,000.00 by your own underinsurance carrier.
An umbrella policy can provide you with an additional $1,000,000.00 in UM/UIM coverage. See my May 5, 2008 post entitled “Automobile Insrance Coverage.
If you are injured by an uninsured driver, you make a claim with your own insurance company. Although your insurance company has a fiduciary duty to treat you fairly, if you make a claim for uninsured motorist coverage, you enter into an adversarial relationship with your carrier. In some cases, it may be necessary for you to retain legal counsel to sue your insurance company, in the event they do not make a reasonable offer to settle your claim. Your insurance company does not retain counsel under these coverages for you when you file suit against them on your UM/UIM coverages.
One thing that most people do not know about UM/UIM coverage is that it is not vehicle-specific. It applies if you are a passenger in another person’s vehicle. It also applies if you are a passenger on a public transportation, such as a bus or a cab, or if you are in a rental car. Your UM/UIM coverage will follow you in these situations. In the event you are in a vehicle which already has UM/UIM coverage and your damages exceed the coverage available on the vehicle that you are in, your UM/UIM coverage will either pay pro-rata with the UM/UIM coverage on the involved vehicle, or that coverage will be primary and your coverage will provide secondary UM/UIM coverage.
Another thing to remember about UM/UIM coverage is that if you have children or relatives, who live with you and are not named on your policy, they will be protected by UM/UIM coverage if they are involved in an accident with another vehicle. You, your children and resident relatives are also covered in situations involving a vehicle v. pedestrian accident.
Can insurance be stacked?
If you have more than one vehicle that is insured with UM/UIM coverage, can this coverage be stacked? Generally speaking, most companies comply with the requirements of NRS 687B.145 and avoid stacking of UM/UIM coverage by providing in their policies exclusionary language which is clear, predominately displayed. They also reduce your premium as a third requirement to prevent stacking of UM/UIM coverage.
There is only one major insurance carrier that I am aware of that stacks UM/UIM coverage. You will pay a slightly higher premium for stacked coverage, however, in the event you have two (2) vehicles insured with 50/100 UM/UIM coverage, you can stack these coverages and the end result is 100/200 UM/UIM coverage.
An insurance carrier in the State of Nevada must offer you UM/UIM coverage equal to your liability coverage. If they do not, and you are involved in a non-at-fault accident, they must provide UM/UIM coverage up to your bodily injury liability limit.
It makes no sense to insure the other driver with 100/300 bodily injury liability coverage and only provide a minimum of 15/30 UM/UIM coverage for your family.
Furthermore, please note that UM/UIM is fault-based coverage. If the other driver is not at fault for the accident, your UM/UIM coverage does not apply.
Another point on UM/UIM coverage is that Nevada Requires physical contact between your vehicle and another vehicle for your UM/UIM coverage to apply. If you try to avoid another vehicle and go off of th road and hit a light pole, your UM/UIM coverage won’t be applicable because you did not have physical conact with another vehicle. The rationale for the physical contact requirement is to prevent fraudulent claims.
Once again you should check your policy or consult your agent regarding the specifics of your UM/UIM coverage.