Adequate Auto Insurance


Do You Have Adequate Automobile Insurance?

The beginning of a new year is a good time to review the protections you have in place for your family, but there is no better time than the present. Automobile insurance is designed to protect you – not only from claims made against you for causing an accident, but also to protect you and your family when someone else causes you injury in a car collision.

Minnesota is a No-Fault State. We hear this phrase often, but it is frequently said with a misunderstanding of what this really means. It does not mean that you are 10% at fault “just for being there.” It does not mean that noone will ever be at-fault for causing your collision. Instead, it means that Minnesota has a law, called the No-Fault Act, that requires your insurance company to include protections on your policy for you and your family in case you are injured in a collision. When you buy liability insurance for your automobile, you automatically get four coverages in one (some exceptions will apply, for example with motorcycles):

  • Liability (for your own fault)
  • PIP (personal injury protection/no-fault)
  • UM (uninsured motorist)
  • UIM (underinsured motorist) coverages

PIP coverage has a mandatory minimum coverage of $20,000 for your medical related expenses, and $20,000 for your wage loss and essential services. This coverage is available to you when you are injured in an automobile-related incident – without determining who is at fault. In fact, this coverage is available to you whether you are at fault, another person is at fault, or even if noone is at fault. In the case of a serious accident, this $40,000 minimum coverage could be rather insufficient.

The good news is that you can purchase more PIP insurance than these minimums. For example, if you have more than one vehicle insured on the same policy, you can choose to “stack” the PIP coverages, usually at only a slight increase in premiums, which multiplies the available limits by the number of vehicles being stacked. If you were injured in a collision, and had three vehicles on the same policy, then with stacking you would have $60,000 available for medical expenses, and a separate $60,000 available for wage loss and essential services for that collision (per person injured). But even if you only have one vehicle on the policy, or prefer not to stack coverages, you can still typically purchase additional coverage to increase one or both parts of your PIP coverage.

UM (uninsured) coverage is to protect you and your family for personal injury damages (excess medical expenses, excess lost wages, pain and suffering, etc) when the person who is at-fault did not have insurance coverage of their own, or the at-fault person cannot be identified (such as in a hit-and-run situation).

UIM (underinsured) coverage protects you and your family in the case of an at-fault party who had insufficient liability coverage to compensate you for the full extent of these same types of damages. If the at-fault party carried only the State’s minimum required liability coverage of $30,000, but you are seriously injured such that your damages are greater than $30,000, your UIM coverage will provide you with additional compensation.

You are in a position to set the limits for these UM/UIM coverages, just as you select the amount of liability coverage you choose to carry on your policy. When selecting these limits, you will want to consider that this is coverage available to you and your family if you are seriously injured or killed in a collision. The greater the limits you choose, the more protection you have for yourself.

Umbrella coverage can provide additional liability protection for your family, but few companies offer an umbrella that extends over your UM/UIM coverage, so be sure your basic UM/UIM limits are adequate or the umbrella extends to these coverages.

You should review your options with your insurance agent, balancing your needs with what coverages you can afford. If you are injured, you should review your coverage, rights, and potential claims with a qualified personal injury attorney. Fullerton Law, P,A. is experienced in this area of law, and is available to assist you or your family in your time of need.