I don't sell car insurance, but as a personal injury lawyer, I often see people get hurt because they have the wrong kind of insurance coverage. Most of the time, this is because they bought their insurance directly from the company rather than from an independent broker.
Many of my clients who have been seriously hurt in car accidents were hit by someone who had no insurance or only the minimum liability insurance coverage, which is $25,000 in New York and much less in many other states. Many of my clients were sold insurance policies with liability limits of $100,000 or $300,000, but they were not also sold uninsured and underinsured coverage.
This problem happened to another new client just this week. My client was walking across the street when a car hit her and then drove away. The driver was caught soon after leaving the scene of the accident. However, the owner of the car only has the minimum liability insurance required by New York State, which is $25,000. My client has serious injuries, including a broken arm, leg, and skull.
My client owns a car with $300,000 worth of liability insurance, but she bought the insurance from GEICO, where the salesperson didn't try to sell her underinsured coverage. GEICO doesn't use independent insurance brokers. Instead, it has its own sales agents sell insurance directly to customers.
My client could have bought underinsured coverage of $300,000 for a small fee. This would have let her get $300,000 instead of $25,000 for her injuries. Ironically, she didn't need the $300,000 liability coverage to protect her assets. But since you can't buy underinsured coverage that is higher than your liability coverage, I would have told her to buy liability coverage for $300,000 just so she could buy underinsured coverage for $300,000.
I've helped a lot of people in this situation who were seriously hurt at work, lost their jobs, and got into a lot of debt. If they had matching underinsured coverage, the extra money available to pay their claim would be a big help to pay their bills and get their life back on track.
Underinsured motorist coverage pays you money from your own car insurance policy if you get hurt in a car accident caused by someone who was careless and had less liability insurance than you did. Uninsured motorist coverage will pay you if the other driver didn't have insurance or if you don't know who was driving the other car.
Underinsured and uninsured coverage is cheap and usually comes in the same limits as your liability insurance. You can't get it for more than what your liability insurance covers.
Underinsured and uninsured coverage is so important that a couple of states now require coverage limits that match your liability insurance limits, unless you decline the coverage in writing. I suggested to a few New York State senators a few years ago that they pass a similar law in New York.
I have also seen many clients who were not sold the maximum medical payments insurance, which only costs me $2.01 a month on my car insurance policy. This is especially important for people who don't have good health insurance. It also helps people who aren't covered by health insurance.
Why should you buy car insurance through a broker who is not tied to a certain company? The reason has been given by the courts. Several "malpractice" lawsuits have been filed against insurance companies because they didn't give underinsured and uninsured drivers the same amount of coverage as the liability limits. But these cases have gone in favour of the insurance companies when they sell directly to customers. When a person buys insurance directly from an insurance company instead of through an insurance broker, the courts decided that the person is only buying insurance and not paying for advice.
When you buy auto insurance from an independent insurance broker who works with several different insurance companies, you get the help of a trained insurance professional who can assess your needs and give you advice based on that. Also, an independent insurance broker is the only one who can give you a choice of insurance companies and premiums, so you can get the best coverage for the least amount of money.
Whether you buy your car insurance directly from an insurance company or through an independent insurance broker, make sure you get the same amount of uninsured and underinsured motorist coverage and the most medical payment benefits.
