What Happens When the At-Fault Driver Is Uninsured or Underinsured?
After a car accident, one of the first questions an injured person may have is whether the at-fault driver has enough insurance to cover the resulting losses. Unfortunately, not every Indiana driver carries adequate liability insurance. Some drivers have no insurance at all, while others carry only the minimum coverage required by law. When a serious accident results in substantial medical expenses, lost income, and other damages, the available insurance may not be enough to fully compensate the victim.
Fortunately, being injured by an uninsured or underinsured driver does not necessarily mean you have no options. Indiana law provides for uninsured motorist and underinsured motorist coverage that may allow you to pursue compensation through your own auto insurance policy. There may also be other potential sources of recovery depending on the circumstances of the crash.
At Lee Cossell & Feagley, LLP, we help Indianapolis car accident victims investigate available insurance coverage and pursue compensation after crashes involving uninsured and underinsured drivers. We also emphasize an important point: whether you are dealing with the other driver’s insurance company or making a claim under your own policy, having an attorney involved can help protect your interests.
What Is an Uninsured Driver?
An uninsured driver is someone who does not have liability insurance to cover injuries or property damage to another when they cause a motor vehicle accident. Indiana requires drivers to maintain minimum financial responsibility coverage, but some motorists nevertheless drive without insurance.
At a minimum, Indiana law requires drivers to maintain liability insurance that pays up to $25,000 for bodily injury or death to one person in any one accident. In addition, drivers must also carry up to $50,000 for bodily injury or death to two or more people in any one accident, plus $25,000 for property damage per accident. Collectively, this is known as 25/50/25 coverage.
Nevertheless, around 14% of Indiana motorists drive without even the minimum insurance required by law. This figure equates to about one in every seven drivers on the road.
A driver may also be considered uninsured in circumstances involving a hit-and-run collision when the responsible driver cannot be identified. Indiana’s uninsured motorist laws contain specific requirements concerning unidentified vehicles and property damage claims, so the details of a hit-and-run case can matter.
If the driver who caused your accident has no applicable liability insurance, you may be able to seek compensation under your own uninsured motorist coverage, assuming you have not rejected that coverage and the circumstances satisfy the terms of your policy.
What Is an Underinsured Driver?
An underinsured driver has liability insurance, but the available coverage is insufficient to compensate you fully for your damages.
For example, suppose another driver causes a serious collision and has the minimum $25,000 in bodily injury liability coverage. If your medical expenses, lost income, pain and suffering, and other damages total substantially more than $25,000, the other driver’s policy may not provide enough coverage to fully compensate you.
In that situation, you may be able to pursue an underinsured motorist claim under your own policy, subject to the policy’s terms and Indiana law.
This distinction is important because being insured does not necessarily mean the at-fault driver has enough insurance to cover the consequences of a serious accident.
Indiana Requires Insurers to Offer UM and UIM Coverage
Indiana law provides important protections for motorists who are injured by uninsured or underinsured drivers. Under Indiana Code § 27-7-5-2, insurers must include uninsured motorist and underinsured motorist coverage with all Indiana automobile liability policies, unless the policyholder rejects that coverage in writing. The statute also provides that UIM bodily injury coverage may not be sold in an amount below $50,000.
This means you should not assume that you do not have UM or UIM coverage simply because you do not remember purchasing it. An attorney can review your policy, declarations page, endorsements, and any applicable rejection forms to determine what coverage may be available.
How Uninsured Motorist Coverage Can Help
Uninsured motorist, or UM, coverage is designed to protect insured individuals who are legally entitled to recover damages from an uninsured motorist. Instead of being limited to whatever assets the at-fault driver personally owns, you may be able to seek compensation from your own insurer under the UM provisions of your policy.
UM coverage can be particularly important when the at-fault driver has no meaningful assets. Although you may have the right to pursue the negligent driver personally, a judgment is only useful if the defendant has assets or other resources from which the judgment can be collected.
UM coverage can provide another potential source of recovery for qualifying bodily injury claims. Indiana law also addresses uninsured motorist property damage coverage, which insurers must offer subject to statutory requirements.
How Underinsured Motorist Coverage Can Help
Underinsured motorist, or UIM, coverage addresses a different problem: the at-fault driver has insurance, but the available liability limits are inadequate to cover your damages.
Suppose you suffer $50,000 in damages and the at-fault driver’s insurance policy provides only $25,000 in applicable bodily injury coverage. Depending on the terms and limits of your UIM policy and the applicable law, your UIM coverage may provide an additional source of compensation.
Indiana law places specific limitations on UIM recovery. For example, the statute addresses how the amount payable for bodily injury is calculated in relation to the damages sustained and amounts paid by or on behalf of liable parties.
That makes reviewing the actual policy particularly important. You cannot determine the value of a UIM claim simply by looking at the other driver’s policy limit.
You May Have More Than One Potential Source of Recovery
An uninsured or underinsured driver does not automatically mean that your only option is a claim against your own insurance policy. Depending on the circumstances, there may be other potential sources of compensation.
For example, if the at-fault driver was working at the time of the accident, an employer may potentially bear responsibility under certain circumstances. If another person’s negligent conduct contributed to the crash, that person or entity may also have legal liability. Vehicle owners, manufacturers, or other parties may become relevant depending on how the accident occurred.
Determining whether these additional avenues exist requires an investigation into the circumstances of the collision, the people and vehicles involved, and the applicable insurance policies.
Your Insurance Company Is Not Your Friend
One of the most important things to understand about a UM or UIM claim is that you are making a claim against your own insurance company, but that does not mean the insurer is automatically looking out for your interests.
When you make a UM or UIM claim, the insurance company has contractual obligations under your policy. At the same time, it has a financial interest in determining how much it ultimately pays on the claim. Disputes can arise over liability, the extent of your injuries, the value of your damages, available policy limits, and whether the circumstances satisfy the policy’s requirements for coverage.
That is why retaining an attorney is important even when you are dealing with your own insurance company. Your attorney can review the policy, communicate with the insurer, investigate liability, document your damages, and challenge an unfair valuation of your claim.
You Should Also Be Careful With the Other Driver’s Insurance Company
The same principle applies when making a claim against the at-fault driver’s insurer. That insurance company does not represent you. Its interests are aligned with its insured and its own financial obligations under the policy.
An adjuster may ask you for a recorded statement, request broad medical authorizations, question the necessity of your treatment, or suggest that you were partially responsible for the accident. Statements made during the claims process can potentially affect the value of your claim.
Having an attorney handle communications with the insurer can help prevent you from inadvertently saying something that could be taken out of context or giving the insurer unnecessary information.
Why You Should Retain a Lawyer for an Insurance Claim
Whether you are pursuing compensation from the other driver’s insurer or filing a UM/UIM claim with your own company, an attorney can help you understand the insurance coverage available and determine how the different sources of compensation interact.
Your attorney can investigate the accident, obtain the relevant insurance policies, review the coverage limits, document your medical treatment and other damages, and negotiate with the insurance companies. If an insurer refuses to make a fair offer, your attorney can evaluate whether litigation or another dispute-resolution process is appropriate under the circumstances.
This is particularly important in serious injury cases. A claim involving substantial medical expenses, permanent injuries, lost earning capacity, or significant pain and suffering can be too important to leave to an insurance adjuster’s assessment alone.
What If the At-Fault Driver Has No Assets?
You may technically have the right to pursue the at-fault driver personally, even if that driver has no insurance. However, obtaining a judgment does not necessarily mean you will be able to collect the full amount of your damages.
An attorney can investigate whether the driver has assets or other sources of recovery, while also examining your own insurance coverage and any other potentially liable parties. The objective is to identify every legitimate avenue for compensation rather than assuming that the absence of liability insurance ends the matter.
Do Not Assume You Have No Options
Learning that the driver who caused your accident has little or no insurance can be discouraging, particularly when your injuries are serious. But it is important not to assume that the insurance situation is the end of your claim.
Indiana’s UM and UIM laws provide important protections, but the availability and amount of recovery depend on the applicable policy, the facts of the accident, the extent of your damages, and the requirements of Indiana law. A careful review of the insurance coverage should be part of the investigation into any serious car accident claim.
Frequently Asked Questions
What happens if the at-fault driver has no insurance in Indiana?
You may be able to pursue compensation under your uninsured motorist coverage if you have applicable coverage and the requirements of your policy and Indiana law are satisfied. Other potential sources of recovery may also exist depending on the circumstances.
Does Indiana require uninsured motorist coverage?
Indiana requires insurers to make uninsured and underinsured motorist coverage available, but a named insured can reject either or both coverages in writing.
What is the minimum underinsured motorist coverage in Indiana?
Indiana law provides that insurers may not sell or provide UIM coverage in an amount below $50,000, and both UM and UIM must at least equal the amount of liability coverage chosen by the policyholder.
Can I make a claim against my own insurance after an accident caused by an uninsured driver?
Yes, if you have applicable uninsured motorist coverage and the requirements for coverage are satisfied. Your attorney can review your policy and the circumstances of the accident to determine whether a UM claim may be available.
Do I need a lawyer to make an uninsured or underinsured motorist claim?
You are not legally required to have an attorney, but legal representation can be particularly valuable when making a UM or UIM claim. An attorney can evaluate your coverage, investigate the accident, document your damages, and negotiate with the insurer on your behalf.
Contact Lee Cossell & Feagley, LLP in Indianapolis Auto Accident Claims
An uninsured or underinsured driver should not automatically prevent you from pursuing compensation after a serious car accident. But identifying the available coverage and protecting your rights can be complicated, particularly when you are making a claim against your own insurance company.
At Lee Cossell & Feagley, LLP, we help Indianapolis car accident victims investigate their legal and insurance options after crashes involving uninsured and underinsured drivers. Whether you are dealing with the other driver’s insurer or making a claim under your own UM or UIM coverage, we can help you understand your rights and pursue the compensation you deserve.
If you or a loved one has been injured in a car accident, contact Lee Cossell & Feagley, LLP today for a free consultation. Let our attorneys review your case and insurance coverage and help you pursue every legitimate source of compensation available.