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Uninsured and Underinsured Auto Coverage BY JOEL WILLIAMS

What is UM coverage? Uninsured or underinsured motorist coverage provides financial protection if you are injured by another driver who does not have enough liability insurance to cover your damages. For example, imagine you are injured in a wreck and your damages are $100,000. What if the at-fault driver only has $25,000 of liability coverage? What about the other $75,000? If you purchased enough uninsured motorist coverage from your automobile insurer, you can look to your own insurance company to make up the difference. So, how does this work in Georgia? For automobile insurance policies issued, delivered or renewed on or after Jan. 1, 2009, the insurer must offer the insured “add on” or “reduced by” underinsured motorist coverage. Georgia law does not require an owner of a vehicle to purchase uninsured motorist coverage, but it does require the insurance company to offer the coverage. What is the difference in “add on” or “reduced by” coverage? Add-on coverage provides coverage over and beyond the at-fault driver’s coverage. For example, suppose you are injured by a negligent driver who has only $25,000 of liability coverage. Further assume that you purchased add-on uninsured motorist coverage with limits of $25,000 and your damages are $50,000. In this situation, there is enough available insurance to cover your damages. The at-fault driver’s insurance would pay the $25,000 of liability limits, and your own insurance company would pay the remaining $25,000. What about reduced-by uninsured motorist coverage? Consider the same situation, but assume you purchased reduced-by uninsured motorist coverage with limits of $25,000. Here, your UM coverage is worthless. Your insurance company, the underinsured motorist insurance

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company, would pay nothing because the amount of coverage available under your UM policy would be reduced by the amount of coverage available from the at-fault driver’s liability policy. In other words, your $25,000 UM limit is reduced by the $25,000 available from the atfault driver’s liability policy. Therefore, you would recover $25,000 from the at-fault party’s liability carrier and $0 from your insurance carrier. The lesson here is simple: always purchase add-on uninsured motorist coverage. All drivers are required to carry $25,000 of liability coverage in Georgia, and reducedby UM coverage will only benefit you if you are injured by an uninsured driver. Most drivers who are uninsured, or who carry minimum-limits coverage, do not have assets to pay a judgment entered against them. Play it safe, protect yourself and purchase add-on UM coverage.

Joel Williams is the managing partner of Joel Williams Law, LLC, a Kennesaw based personal injury law firm. gatrialattorney.com

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