INSURANCE: WHAT IS UNINSURED MOTORIST COVERAGE

Jarrett & Price, Trial AttorneysIn Georgia, Uninsured Motorist policies (UM) are written to cover you in situations where the at-fault party is uninsured or does not carry enough insurance to cover all of your damages. Depending on which type of insurance you purchased, this can have a dramatic impact on the amount of insurance available to cover your claim. Currently, Georgia allows two distinct types of UM policies to be written to Georgia insureds. These are commonly referred to as 1) “traditional” and 2) “excess” policies.

Traditional (a.k.a. “set off”) UM  

Until 2009 this was the only type of UM policy which could be written in Georgia. While it is commonly referred to as “traditional” or “set off” UM, plaintiff attorneys commonly refer to it as “rip off” UM.

This coverage is still offered in Georgia, usually at a small discount by the insurer. The problem with this coverage is that the limits of coverage are “set off” by the at-fault parties liability insurance limits. As a consequence, there are many scenarios where this UM is not available to cover the insured’s claim, even though they are paying for it in their premiums.

For example, let’s say your injured and your total damages are approximately $100,000. If you carry a limit of $50,000 of traditional UM, and the at-fault party also carries $50,000 in liability insurance, you would assume that your combined insurance in this scenario would cover all your $100,000 combined damages.

Not so. Because traditional UM is set off by the amount of available liability insurance, your UM policy would provide you no coverage in this scenario. The at-fault driver would pay the limit of their $50,000 policy. But your $50,000 UM limit would not be available because it is set off by the amount of liability coverage ($50,000 UM – $50,000 liability = 0).

Thus the name “rip off” UM.

Excess (a.k.a. “add on”) UM

Fortunately, since 2009 Georgia insureds have been able to purchase “excess” or “add on” UM policies to get what they pay for.

Excess UM works like you would think an underinsured policy should work. It is added to the amount of liability insurance. So using the above scenario, the at-fault driver would pay the $50,000 limit of their liability policy. Then your $50,000 excess UM policy would cover the remaining damages so that you receive full compensation for all your damages ($50,000 UM + $50,000 liability = $100,000).

Note that in this common coverage scenario, there is a $50,000 swing based on which type of UM insurance is selected by the insured. Nevertheless, insurance policy writers continue to encourage their insureds to purchase the old fashioned “rip off” UM by offering it at a slight discount. There are also various scenarios where the inferior UM policy the insurance company intended to sell to you is not the one which should apply.

If you are injured in an accident, Jarrett & Price, LLC will investigate any UM policies which may apply to your claim – even UM policies you may not be aware of. Contact our personal injury attorneys serving northeast Georgia at our Clarkesville, Georgia and Cleveland, Georgia offices, by calling (706) 770-6669 – (912) 999-2599. To talk to our attorneys in Savannah, Georgia, call (912) 999-2599.  All consultations are FREE and an attorney WILL return your call.


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