Contrary to the lawsuit timeline established in many popular television shows, like Law & Order or Boston Legal, personal injury cases often take months or years to resolve. While you wait for your case to resolve, you may not have money to pay for medical treatment, your normal bills, or even food for your family. This can place an injured person in a very undesirable position. However, there are different types of insurance that can protect you while you wait for your personal injury claim to resolve and to provide you with more money in settlement.
Insurance is a subject most people only think of after an accident occurs. But, you should be thinking ahead and establishing insurance for a worst-case scenario, which is why insurance exists in the first place. There are several types of insurance that can play a role in an accident case that can make things easier for you after an accident.
Health insurance is a first line of defense in accident cases. All medical providers are required to submit your medical bills to your health insurance for adjustment and payment. This means you are not responsible for the entire amount of the bills, only your out-of-pocket expenses or deductible/co-pay pursuant to the terms of your health insurance policy.
Health insurance is a huge benefit to a person injured in Virginia. Under Virginia law an injured person can claim the entire amount of their medical bill, not just what was paid by the insurance company or injured person. For example, if your medical bill was $1,000.00, the amount allowed to be billed by the medical provider was adjusted down (pursuant to the provider’s agreement with your health insurer) to probably around $400.00, with either your health insurance company, the injured individual, or both, making payment of the $400.00 that was allowed to be billed. Despite the fact only $400.00 was allowed to be billed under the policy, the injured person can still claim the full $1,000.00 as their cost of care. This allows more money to come back to the injured person.
Health insurance offers you financial protection in the event of an accident or illness. Health insurance may be offered by your employer, and available through the Affordable Care Act or other government programs. Some health insurance plans may have a lien against settlement proceeds in an injury case, but only for the amount they actually paid.
Consider a Health Savings Account
When it comes to medical treatment, out-of-pocket expenses can be a huge financial burden. Setting up a health savings account (HSA) is a great way to pay for those out-of-pocket expenses and deductibles. An HSA allows you to put money in the savings account pre-tax for payment of medical bills only. This can lower your annual taxable income and ensure that you have a medical payment fund in the event of an accident or just for your ordinary medical care. Many people find HSAs give them the reassurance that they have funds available if an accident or medical issue occurs.
Car Insurance (Uninsured and Underinsured Motorist Coverage, Personal Injury Protection and Medical Payment Coverage)
Your car insurance can also provide you protection in an automobile accident. Your car insurance can provide accident protection through (1) Uninsured/Underinsured Motorist Coverage, (2) Personal Injury Protection, and (3) Medical Payment coverage.
Uninsured and Underinsured Motorist Coverage
In July 2023, Uninsured and Underinsured Motorist (UIM) Coverage became required for all automobile insurance policies in Virginia. This means you automatically have the coverage UNLESS you opted out of the coverage when signing up for your plan. When signing up for your coverage many insurers will send you prompts indicating you can or should opt out of our UIM coverage, don’t do it!
UIM Coverage provides you insurance coverage above and beyond that of the at-fault driver. If the at-fault driver does not have sufficient policy limits (the amount their insurance is obligated to pay in the event of an accident) to cover your injuries, your UIM policy can provide additional payment to you for your injuries.
As of July 2023, the minimum policy limit of an automobile insurance policy in Virginia is $30,000.00. If an at-fault driver has the minimum policy limits, this means the most their insurance company is obligated to pay you is $30,000.00, no matter how badly you were injured. If you opted out of UIM coverage then you are stuck with the $30,000.00 available from the other driver’s insurance policy. But, if you have UIM insurance you can recover an additional amount up to your UIM policy limits. If you live in a house with family members and there are multiple automobile policies, you may qualify for additional UIM coverage from your family member’s policies. Always check with the family members you live with to see if they have UIM coverage on their auto insurance in the event of an accident.
For example, you are injured in an automobile accident and have $50,000.00 in medical bills and also missed time from work, along with your pain and suffering, mental anguish, and inconvenience. After the accident, you learn the other driver only had $30,000.00 of insurance coverage available. This isn’t even enough to cover your medical bills. But, you’re lucky. You have UIM coverage of $100,000.00 on your policy. Now, not only can you recover the $30,000.00 from the at-fault driver’s policy, but you also have access to an additional $100,000.00 from your policy, meaning there is a total of $130,000.00 of coverage to you for the accident. This means you have the potential to be more fully compensated for your injuries, although your UIM coverage may still not provide you payment for the full amount your case is worth. Aren’t you glad you decided to pay for UIM coverage?
Although UIM coverage may increase the cost of your car insurance there are ways to lower the amount of your monthly premium to allow you to have this coverage.
Maximize Your Insurance Coverage and Pay a Lower Premium
Making your insurance coverage work harder should help you to spend less. Here’s how to maximize the benefits of your insurance coverage:
Your automobile insurance policy premium is determined by numerous factors, some of which are the amount of coverage you want, the amount of your deductible, and any additional coverage you elect to receive from the insurer, along with many other factors. Don’t settle for the first insurance provider you call. The cheapest premium won’t always save you money. Check what’s included in the coverage. Cheaper premiums could mean far higher out-of-pocket expenses. A mid-price insurance policy with a higher level of coverage could save you more money throughout the year. Remember, your UIM coverage is equal to the amount of coverage you maintain on your policy unless you elect for lower UIM coverage, so you determine the maximum amount you can recover under your UIM policy.
Shopping around for insurance coverage can take a little extra time. However, the amount of cash you could save makes it totally worth the effort.
Increase Your Deductibles
Your deductible is the amount you pay out of pocket before your insurance will pay for repairs to your vehicle. Typically your auto insurance will set your deductible around $500.00. But, if you can afford to pay more out of pocket (say $1,000.00), you can increase the amount of coverage available to you and pay the same premium as you would have for a policy with lower limits. This means you can have more UIM coverage available to you in the event of an accident.
When establishing your policy ask the insurance agent how much coverage you could get for the same price if you increased the amount of your deductible. Make sure the quote they are giving you includes UIM coverage, and remember, never opt out of UIM coverage and make sure it is specifically included in your policy.
Personal Injury Protection
Personal Injury Protection (PIP) provides coverage for lost wages and payment of medical expenses after an accident. You must opt into this coverage in Virginia. PIP benefits may be offset by other insurance available to you in the same accident (i.e., Workers’ Compensation benefits and Short or Long Term Disability Benefits). PIP coverage can provide you additional protection for payment of medical bills and time missed from work.
Medical Payment Coverage
Medical Payment Coverage (Med Pay) provides coverage for medical bills you receive as a result of an accident. Med Pay is required for Virginia automobile policies, but you can opt out of the coverage. Med Pay is a good financial resource to lower the amount you pay out-of-pocket for medical care following an accident.
Short Term Disability and Long Term Disability
Short Term and Long Term Disability coverage provide payment for lost wages following an accident, illness or other qualifying event. Disability policies may be available from your employer or you can pay for a policy on your own. Short Term Disability typically provides payment of lost wages for six months at or near the amount you made at the time of the accident. Long Term Disability typically provides wage loss payments for two years at about two-thirds of the amount you were earning when your accident occurred. Long-term disability can provide payments after the initial two years if additional disability criteria are met. These policies typically require a doctor to put in writing that you cannot return to work based on your injuries or illness. Every Disability Policy is different, so be sure you closely read the insurance policy and all accompanying documents to understand the benefits available to you and what you need to do to qualify for benefits.
Disability policies may have a lien against the proceeds of a personal injury case depending on the terms of the policy.
Insurance is an expense most people would really rather not deal with. After all, no one wants to pay cash for something they may not need at the time they sign up. But, not having insurance is a huge risk. Make sure that you have sufficient insurance to protect yourself and your family in the event of an accident, it could save your livelihood while you wait for your personal injury case to be resolved.
Request a Free Consultation With Our Trusted Accident Lawyers
Here at Renfro & Renfro, we understand that insurance is a big expense for many people. We also know that many insurance claims are not successful. The result? People injured in accidents are left out of pocket while attempting to recover from long-term injuries. Building a strong case is essential to get your medical claim covered. To achieve this, you need help from a highly experienced accident attorney.
We believe that everyone should receive the compensation they deserve after an accident. That’s why we offer a free consultation and case evaluation for victims of accidents. Contact us today to find out how we can help you.