I hear it all the time and I hate it more and more each time it is uttered.
“But I have full coverage.” Friends, there is no such thing
as “full coverage.” Unfortunately, in the world of car insurance
this is a term that can have multiple meanings to different people. You,
the consumer, have something in mind when you use the phrase. Your insurance
agent or company hears something different.
A typical scene: I am visiting a severely injured person or the loved one
of someone who has recently died in a car accident at their home. We are
discussing the tragedy of the collision and the client is upset because
medical bills are starting to come in the mail. They are astounded that
an air ambulance is billing $43,000 for a trip from Prescott to Phoenix.
“It’s typical,” I sadly explain. “Will the at-fault
driver’s insurance pay for all this? I am still out of work and
have more medical care, who will pay for that?”
It is at this point that I must break the bad news. In Arizona we have
had the same minimum required insurance rates since 1972. $15,000 per
person/$30,000 per collision. Many people only purchase the legally required
minimum and sometimes they let it lapse so they are uninsured.
There is still hope. There could be higher limits if the adverse driver
was able to buy it. And there is uninsured coverage and underinsured coverage.
This is the coverage that protects you, the victim, from being hit by
an at fault driver without any insurance or without enough insurance to
cover the damages or bills.
“Do you have that?” And
that is when I hear it: “I have full coverage.” Oh no!
Full coverage can mean that the victims are protected with uninsured or
underinsured coverage but it can also mean that they have the minimum
requirements: a $15,000/$30,000 liability policy. A liability policy only
protects the person you hit. A victim is not protected with his own insurance
if it is a liability only policy.
Heed this warning: Do not get left holding the bag. I have seen tragedy
up close with many of my clients who have not only lost a loved one but
there is not enough money to pay for the funeral or cover the medical
bills. I have seen seriously injured people who are forced back to work
while injured to avoid bankruptcy because they are trying to pay their
medical bills--all because someone hit them. It is not fair and it is
not right. Make sure that you have uninsured and underinsured coverage.
You may never need it but if you do, you won’t regret buying it
(and it is surprisingly affordable).
I am a lawyer, a person who helps victims of serious injuries and death,
I make no money from insurance sales. However, I have seen the consequences
when a client believes he has “full coverage” and gets stuck
holding the bag.