Uninsured/Underinsured Motorist (Bodily Injury)

By law, when an automobile insurance policy is purchased in Florida which includes bodily injury liability (BI) coverage (which is optional in Florida), the insurance company selling the policy must offer to sell the insured uninsured/underinsured (“UM”) coverage for an amount up to the same limits as the bodily injury coverage being purchased. If the policy purchased contains only the minimum mandatory Florida auto coverage, which is $10,000 in PIP/No-Fault and $10,000 in Property Damage Liability (PD), the insurer does not have to offer UM coverage.)

When an insured is offered UM coverage, the insured’s choice to either reject the offer of UM coverage, or to select “non-stacking” UM coverage, or UM coverage in an amount less than the bodily injury (BI) limits, must be documented by the insurance company on a form approved by the Florida Office of Insurance Regulation (OIR), signed by the insured or the insured’s authorized representative. Generally, when an insurance company is unable to produce the signed form after a loss, the insurance company will provide stacking UM coverage in the same amount as the bodily injury liability limits.

There are many complexities regarding the selection and rejection of UM coverage, and its availability or application to any give automobile accident, due in large part to the very large volume of judicial decisions (case or common law) in Florida interpreting the Florida UM statute, Florida Statutes, Section 627.727.

Example of UM coverage application:

A person with UM coverage on his or her own insurance policy, or through the insurance policy of the vehicle he or she occupies at the time of the accident, makes a UM claim to that insurer for personal injuries. The insurance company will assess whether the injury first, arose from the ownership, maintenance or use of an uninsured or underinsured motor vehicle. Next, the insurance company determines whether the injured person was him or herself at fault for the accident, as that degree of fault (of 100%) would reduce the claim by that percentage. If the at fault driver or drivers had their own liability (BI) coverage, that amount generally would need to be paid before UM coverage would be payable. (A UM insurer may not insist that the injured party recover from the at fault person(s) prior to honoring a UM claim, although a UM insurer paying a claim before the available liability limits were exhausted would, typically, preserve its right to recover the UM payment from such person(s) and their insurer(s). Such a claim is payable when the damages suffered by the insured are greater than the amount of automobile liability coverage available to the person(s) or business causing the accident.

If, for instance, the insured suffers injuries, determined to be worth $50,000 in compensation, and the person causing the accident only had available $25,000 in bodily injury liability (“BI”) coverage, the UM insurer would pay up to $25,000 in damages, provided, of course, that the UM policy coverage was $25,000 or greater.

If a UM insurer refused to pay the insured, for whatever reason, the insured could bring a lawsuit directly against the UM insurer. And, if the insurer for the driver causing the accident refused, for whatever reason, to pay damages, the UM insured would, if sued, bring a third party case against the driver of the other vehicle (but not his or her insurer) once a UM payment is made.

Again, there are many complexities to UM claims, due to the insurance policy provision or endorsement providing the coverage, the issues surrounding whether an insurer complied with the mandates of the Florida UM statute with regard to notice of insurance options to prospective insureds, and the application of court (judicial) decisions to the facts of a given accident or status of an injured person as a vehicle occupant, vehicle owner or resident of a household with other persons also having UM coverage on their own vehicle(s).

The damages recoverable by a person insured under the UM provisions of a policy are the same as those elements of damages recoverable in a third party (liability) claim or lawsuit, as discussed above. (These damages include, past medical expenses, future medical expenses, past wage losses, future lost earnings or capacity, past pain and suffering, future pain and suffering, past lost consortium by a spouse and future lost consortium by a spouse.)

UM Subrogation: An insurance company which pays an insured UM benefits has a right, based on generally standard policy language (and common law), to seek reimbursement (subrogation) against the person(s) or entity/business responsible for causing the injuries for which the UM coverage was paid. An insured may, however, prevent his or her insurer from collecting its UM payments from an at fault party until the insured is “made whole”. In other words, the injured insured generally has the first right to recover funds available to fully indemnify him or her for damages/injuries suffered.