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What is Underinsured/Uninsured Motorist Coverage, and How Does it Help Florida Drivers?

The National Safety Council estimates the average cost of personal injuries caused by automobile accidents to be between $24,000 and $64,000 depending on location. In the Tampa Bay area, auto accident injuries can run well above these limits. Florida also has one of the highest uninsured motorist rate, with over 23 percent of drivers not carrying insurance.

Many people completely misunderstand how insurance coverage works, especially when it comes to underinsured/uninsured motorist coverage. Some states actually require that all drivers carry this coverage. To explain how this type of insurance can really help you if you are involved in a serious car accident, it is important to understand how insurance works in general and how policy limits affect your ability to get compensated.

What is insurance really?

Insurance is more than just some annoying requirement that costs you money. In short, it follows a system of “subrogation,” which comes from the Latin word “subrogare” or “to substitute one for another.” Therefore, the word is fitting because the insurance company charges you a premium in exchange for being willing to stand in your shoes when you need them. This means they will pay for things you would normally pay for, and they will pay for your lawyer when you normally would have to. So, it is paid protection, if you will.

What are Florida’s minimum policy limits for insurance coverage?

Shockingly, in a world where a single visit to the emergency room can cost well over $25,000 and the standard mid-sized sedan costs $30,000, Florida only requires a minimum policy of $10,000 personal injury protection (PIP) and $10,000 property damage liability (PDL) coverage. Personal injury protection is the amount an insurance company will pay if the driver injures someone. Property damage liability is what the insurance company will pay if the driver does damage to someone’s property. As you may guess, this is entirely insufficient to pay for most late model vehicles, and far too little to adequately compensate for serious injuries.

How does uninsured and underinsured motorist (UIM) coverage work?

When you are involved in an accident with a driver who only carries a minimum policy or, worse yet, who carries no insurance at all, “UIM” coverage will pay for your injuries in excess of the coverage that the other party has. In Florida, your UIM limits cannot exceed your bodily injury limits. So, if you select $100,000 bodily injury, then you can select up to $100,000 for UIM.

What is “stacking,” and why should I do it?

Stacking is a great way to get the most bang for your buck, so to speak. In Florida, insurance companies allow you to choose between stacked or unstacked. Unstacked simply means that if you have multiple cars on the policy, each will have a separate limit. For instance, a driver with two cars who chooses $100,000 unstacked coverage is limited to collecting that amount from a single accident in that vehicle. However, if the same driver purchases stacked coverage, then he could combine the limits from his two vehicles and collect $200,000 from a single accident.

If you are confused about insurance coverage, be sure to ask your insurance company lots of questions. A reputable company will happily explain your coverage in detail and offer you plenty of literature and materials to help you select the right coverage. Do not be fooled into thinking you only need the minimum coverage required by the state. If involved in a car accident in the Tampa Bay area, your best chance of collecting the most money from your policy and the other driver’s policy is to contact an experienced personal injury attorney at the Romero Law Firm who can help navigate the complex web of insurance laws that apply to Florida drivers.

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