How Underinsured Motorist Coverage Works in Florida

Florida’s No-Fault Law ensures that if you’re involved in a car accident, your insurance company will pay for your medical bills and certain other expenses (up to your coverage limits), regardless of who was at fault for the accident.

However, many drivers are unaware of the importance of underinsured motorist (UIM) coverage, which can provide crucial financial protection in cases where the at-fault driver does not have enough insurance to cover your damages.

What is Underinsured Motorist Coverage?

Underinsured Motorist Coverage (UIM) is optional insurance coverage that can be added to your auto insurance policy. It is designed to protect you if you are involved in an accident with a driver who does not have sufficient insurance to cover your medical expenses, lost wages, and other damages. UIM covers the gap between the at-fault driver’s insurance limits and the total amount of your damages.

How Underinsured Motorist Coverage Works in Florida

1. Coverage Activation: UIM coverage is activated when you are in an accident with a driver with liability insurance, but their policy limits are insufficient to fully cover your damages.
2. Supplementing PIP: In Florida, your Personal Injury Protection (PIP) insurance will cover up to $10,000 of your medical expenses and lost wages, regardless of fault. However, PIP may not be enough to cover all your costs, especially in cases of severe injuries.
3. Filing a Claim: If the at-fault driver’s insurance is insufficient, you can file a claim with your own insurance company under your UIM coverage. This can help cover medical expenses, lost wages, and other damages that exceed your PIP and the at-fault driver’s liability coverage.
4. Legal Thresholds: Similar to when you can sue the at-fault driver, your injuries must meet certain legal thresholds to claim under UIM coverage. This includes significant and permanent loss of an important bodily function, permanent injury, significant and permanent scarring or disfigurement, or death.

Why Underinsured Motorist Coverage Matters

• Comprehensive Protection: UIM coverage ensures you are not left with significant out-of-pocket expenses if you are hit by an underinsured driver.
• Peace of Mind: UIM coverage can provide peace of mind, knowing that you and your passengers are financially protected in an accident with an underinsured driver.
• Enhanced Coverage: UIM can cover medical expenses, lost wages, pain and suffering, and other damages that exceed the limits of the at-fault driver’s insurance.

Real-World Example

Imagine you’re rear-ended at a traffic light. You suffer a serious back injury requiring extensive medical treatment. The at-fault driver has liability insurance, but only up to $20,000, while your medical bills and lost wages total $50,000.

Without UIM Coverage:

• Your PIP insurance will cover up to $10,000 of your medical bills and lost wages.
• You can claim the $20,000 from the at-fault driver’s insurance.
• You would still be left with $20,000 in uncovered expenses.
• You would not recover for pain and suffering, disability, disfigurement, scarring or mental anguish.

With UIM Coverage:

• Your PIP insurance will still cover the first $10,000.
• You can claim the $20,000 from the at-fault driver’s insurance.
• Your UIM coverage can cover the remaining $20,000, ensuring you are not left with out-of-pocket expenses.
• Your UIM coverage, depending on the amount, would sit in the shoes of the at-fault driver for purposes of pain and suffering, disability, disfigurement, scarring or mental anguish damages.

But what if your injuries are catastrophic and exceed UIM limits?

In Florida, drivers are not legally required to carry bodily injury liability insurance. That means many drivers are not financially responsible for the serious injuries they cause — unless you take legal action.

Suing the Other Driver in a No-Fault State

Florida’s no-fault insurance system sets certain thresholds that, if met, allow you to file a lawsuit against the at-fault driver.

When You Can Sue the At-Fault Driver

You can sue the other driver if your injuries meet the following criteria:

1. Permanent impairment Injury Threshold: You can sue if you suffer from injuries that are considered serious under Florida law. The law requires that you have a permanent impairment, which may include:
   • Significant and permanent loss of an important bodily function.
   • Permanent injury within a reasonable degree of medical probability.
   • Significant and permanent scarring or disfigurement.
2. Damages Exceed PIP Coverage: If your medical expenses and lost wages exceed the $10,000 PIP limit, you can pursue additional compensation from the at-fault driver. This includes compensation for pain and suffering, mental anguish, and other non-economic damages.

Types of Damages You Can Claim

When you sue the at-fault driver, you can seek compensation for various types of damages, including:

1. Medical Expenses: Costs for current and future medical treatments, surgeries, rehabilitation, and other necessary medical care.
2. Lost Wages: Compensation for income lost due to the inability to work due to the accident, including future lost earnings if you cannot return to work.
3. Pain and Suffering: Non-economic damages for physical pain, scarring, disability, emotional distress, and diminished quality of life resulting from the accident.
4. Property Damage: Costs to repair or replace your vehicle and any other personal property damaged in the accident.
5. Other Out-of-Pocket Expenses: Additional costs related to the accident, such as transportation to medical appointments and assistance with daily activities if you cannot perform them yourself.

Underinsured motorist coverage is a crucial component of your auto insurance policy that can provide significant financial protection in the event of an accident with an underinsured driver. But it’s not always enough. We always recommend that drivers obtain the largest amount of UIM coverage they can afford, since it is the only insurance you can get to protect yourself.

For more detailed information and legal assistance, contact a personal injury attorney at Leighton Panoff Law.