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The following is adapted from the ATLA brochure entitled "What you don't know about your automobile insurance can hurt you...and your family." Table of Contents
What choices do I have when I purchase or renew my auto insurance policy?You are required to elect either the Standard Policy or the Basic Policy. WE RECOMMEND THAT YOU PURCHASE A STANDARD POLICY.
What is the Basic Policy?The Basic Policy (also known as the mini-policy) provides only $5,000 of property damage liability coverage if someone makes a claim against you and $15,000 of medical expense benefits (up to $250,000 for permanent or significant brain and spinal cord injury, disfigurement, and immediate trauma center treatment) if you or a resident family member is injured. The Basic Policy does not provide coverage if you injure someone else. However, you have the option of electing coverage in the amount of $10,000 for injury to one or more persons in the same accident if someone makes a claim against you. The Basic Policy does not provide any uninsured motorist coverage to protect you and your family if the careless driver who causes the accident is uninsured or is insured under a Basic Policy with no bodily injury liability coverage. NEVER BUY BASIC.
If I elect the Basic Policy, will my insurance company hire an attorney to defend me if someone else who was injured sues me for damages?If you elect a Basic Policy with no bodily injury liability coverage, your insurance company will not provide an attorney to represent you. If you are sued - even if you are not at fault for the accident - you will have to hire your own lawyer at great expense to defend you or else you will risk the entry of a default judgement against you with the loss of your driver's license.
Should I purchase the Basic Policy?NO. The members of ATLA-NJ believe that the Basic Policy does not provide adequate protection for your assets if you are sued nor adequate coverage for you or your family if you are injured by a careless driver. DO NOT ELECT THE BASIC POLICY.
What is the Standard Policy?The Standard Policy provides liability coverage if someone makes a claim against you with minimum limits for bodily injury of $15,000 per person/$30,000 per accident and property damage of $5,000. In addition, the Standard Policy provides uninsured motorist coverage with minimum limits of $15,000 per person/$30,000 per accident if you or a resident member of your family is injured by a person who is uninsured or has no bodily injury liability coverage.
Should I purchase the Standard Policy?YES. The members of ATLA-NJ believe that the Standard Policy provides the best insurance coverage to protect your assets if you are sued and to provide compensation to you and your family if you are injured. WE RECOMMEND THAT YOU ELECT THE STANDARD POLICY.
Does the Standard Policy provide coverage for medical expenses?Yes. The Standard Policy provides personal injury protection (PIP) coverage which includes medical expenses up to $250,000 per person per accident. You may elect to purchase less coverage in the amounts of $15/50/75/150,000; however, if you do, you may not have enough insurance to obtain all of the medical treatment you need or to pay for all of your medical bills. WE RECOMMEND THAT YOU PURCHASE $250,000 OF PIP MEDICAL EXPENSE COVERAGE.
Who decides what type of medical treatment and diagnostic testing I am to receive?You will probably rely upon your treating doctor to make medical decisions concerning the nature of your injuries and your treatment; however, some insurance companies may offer the option of or require "pre-certification." This requires your doctor to request authorization from the insurance company before rendering any medical treatment or administering any diagnostic tests. We believe that the choice of treatment should be the responsibility of your doctor, not your insurance company. WE RECOMMEND THAT YOU DO NOT SELECT A POLICY WITH PRE-CERTIFICATION.
If I am injured, can I make a claim or file a lawsuit against the careless driver who caused the accident?It depends on your policy and the nature of your injuries. If you purchase a Standard Policy, you are required to elect a "tort option" that will determine if you have the right to make a claim. You must elect either the "limitation on lawsuit option" or the "no limitation on lawsuit option." If you purchase a Basic Policy, you are assigned the "limitation on lawsuit option."
What is the "limitation on lawsuit option"?The lawsuit limitation option (also known as the verbal threshold) limits
your legal rights to make a claim for monetary damages or to file a lawsuit
against a careless driver unless you sustain one of the following types of
injury.
What is the "no limitation on lawsuit option"?The no limitation option (also known as "no threshold") permits you to make a claim or to file a lawsuit against a careless drivers for any and all personal injuries. WE RECOMMEND THAT YOU ELECT THE "NO LIMITATION ON LAWSUIT OPTION."
Who benefits if I purchase a Basic Policy or a Standard Policy with the lawsuit limitation option?You will reduce the cost of your automobile insurance; however, you will be giving up insurance benefits and legal rights in order to save money. The careless drivers who cause accidents will benefit because they may have no legal responsibility for your pain and suffering. The insurance companies who provide coverage for careless drivers will benefit because they may not have to pay any monetary damages for your injuries.
How can I protect myself and my family if we are sued?A Standard Policy provides liability insurance with minimum limits of $15,000 per person/$30,000 per accident if you or your family are sued; however you may purchase additional coverage to protect your assets.
How can I protect myself and my family if we are injured by a careless driver who is uninsured or unidentified?A Standard Policy automatically provides coverage for injuries caused by an uninsured or hit-and-run driver in the amount of $15,000 per person/$30,000 per accident; however, you may purchase additional coverage up to the amount of your liability coverage.
How can I protect myself and my family if we are injured by a careless driver who is insured but does not have adequate coverage?The amount of your recovery from a careless driver may be limited by the amount of liability insurance purchased by that driver and by the owner of the vehicle. However, if you purchase a Standard Policy, you can purchase underinsured motorist coverage up to the amount of your liability coverage.
How much coverage do you recommend?Most people feel that the minimum limits of $15,000 per person/$30,000 per accident are inadequate. Many people purchase additional coverage up to $100,000/300,000 or $250,000/500,000. We recommend that you purchase liability coverage with single limits of $500,000 or the highest limits that you can afford. In addition, you should purchase uninsured/underinsured motorist coverage with the same limits as your liability coverage.
What happens if I do not purchase any automobile insurance?The law requires the owner of every motor vehicle to purchase insurance. If you do not purchase insurance, you will be subject to civil and criminal penalties. In addition, if you are injured while operating an uninsured automobile, you will not be permitted to make a claim or file a lawsuit against the careless driver for economic or non-economic loss, even if you were not at fault for the accident.
Can I purchase other insurance protection in addition to automobile insurance?Yes. You can purchase a personal catastrophe liability umbrella at a reasonable cost that will provide additional coverage if a claim is made against you or any resident family member for injuries sustained by another person anywhere in the world due to the operation of a motor vehicle or for any other reason. In addition, some companies offer umbrella policies that include uninsured/underinsured motorist coverage. We recommend that you purchase a personal catastrophe liability umbrella with limits of $1 million.
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Gertel & Feld, P.C. |
