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                      UNDERSTANDING YOUR NEW YORK MOTOR
                                 VEHICLE INSURANCE POLICIES:
                        IS YOUR INSURANCE COVERAGE ADEQUATE?

                  BY: HUGH W. CAMPBELL, ESQ.

           Very often when I ask clients what type of automobile insurance coverage they
    carry, I am usually given the response; “I have full coverage”. The term “full
    coverage” is frequently misunderstood, and as such too many motor vehicle owners
    operate their vehicles without adequate insurance coverage.

           New York State Insurance Laws provide that every motor vehicle operated on
    the roads of the state must carry minimum insurance coverage. The mandatory
    insurance required for motor vehicles are usually broken down into four categories;
    (I) Liability Coverage; which insures the owner and driver against claims from an
    injured person. The law requires that every automobile insured in the State of New
    York must be insured with a minimum liability coverage of $25,000.00/$50,000.00.
    In the event you carry the minimum insurance coverage required by law of
    $25,000.00/$50,000.00, and one person is seriously injured as a result of the
    negligence of the driver of your vehicle; the maximum your insurance company will
    pay the injured person on your behalf will be $25,000.00. If more than one person is
    seriously injured as a result of the negligence of the driver of your vehicle, the
    maximum your insurance company will pay to be shared between all the injured
    individuals on your behalf will be $50,000.00. (2) Property  Damage; which insures
    the owner and driver with a minimum of $10,000.00 in the event your vehicle causes
    damage to another person’s vehicle or property as a result of  the negligence of the
    driver of your vehicle. (This coverage does require your Insurance Company to
    make repairs to your vehicle in the event it is damaged in an accident).  (3)  
    Personal Injury Protection, (usually refereed to as “No-Fault”). This coverage
    pays for the injured person’s reasonable and necessary medical bills, lost wages,
    transportation expenses to and from medical providers, medication, etc., up to
    $50,000.00, irrespective of who caused the accident. The insurance company of the
    vehicle you are operating, or in which you are a passenger is responsible to pay for
    your “No-Fault benefits (this may be different if you are a passenger on a bus). In
    the case of a pedestrian, the insurance company of the vehicle that struck the
    pedestrian must provide “No-Fault” coverage. An injured person is entitled to recover
    their “No-Fault” benefits even if their injuries do not meet the “Serious Injury”
    criteria of the Insurance Laws. (4) Supplemental Insurance. Supplemental
    Insurance is mandatory, and it is the least understood. It is a part of every
    automobile policy written in New York. This type of insurance provides coverage to
    the operator and passengers of your vehicle in the event the operator and/or
    passengers were injured by a vehicle that did not have insurance coverage, or in the
    event your vehicle was hit by a hit and run vehicle. Although it is always a very
    difficult concept for vehicle owners to understand, an injured member of your
    household can make a claim against your insurance company, even though your
    vehicle was parked and locked in the garage and had absolutely nothing to do with
    their accident.
           If you are an operator or a passenger in a vehicle and your vehicle is involved
    in an accident with a vehicle that does not have insurance coverage, the operator and
    passengers of your vehicle can make a claim against your own insurance company
    under the Supplemental Insurance portion of your policy to recover for their
    Personal Injuries. If a member of your household is struck by a vehicle while they
    are a pedestrian, and the striking vehicle does not have insurance, or did not stop, the
    injured member of your household can make a claim against the Supplemental
    Insurance portion of your insurance policy.
           This portion of your insurance coverage also benefits you and injured members
    of your household if you carry a higher insurance coverage than the vehicle that
    caused the accident. For example; if you, your passengers, or a member of your
    household was seriously injured by a vehicle that carried the minimum liability
    insurance coverage of $25,000.00, and you carried a higher Liability Coverage of
    $100,000.00, and Supplemental Coverage of $100,000.00, you, your passengers or a
    member of your household could make a claim against your own insurance company
    for the difference between the other vehicle’s $25,000.00 and your $100,000.00
    Supplemental Coverage. If the injuries were caused by a vehicle that had no
    insurance or a hit and run vehicle, a claim can be made for the full amount of your
    Supplemental Insurance coverage.  
           A common mistake that many motor vehicle owners make is they carry high
    insurance coverage against which someone else can recover, however they fail to
    spend the very nominal amount which is required to increase their Supplemental
    Insurance coverage above the minimum of $25,000.00.  In order to adequately
    protect yourself and your family, the limits of your Supplemental Insurance
    Coverage should always be as high as your liability coverage.
           Traditionally, in New York and many other states, if one spouse was seriously
    injured in a motor vehicle operated by the other spouse, the injured spouse could not
    recover from the insurance company of the negligent spouse.
           This was changed on January 1, 2003 when a new law became effective,
    which requires insurance companies to offer optional Supplemental Spousal
    Liability Insurance. In accordance with the new law, insurance companies must
    now notify their insured of the existence of this new type of insurance coverage, and
    the company must offer this coverage if requested. If this Supplemental Coverage is
    purchased, and one spouse is seriously injured as a result of the negligence of the
    other spouse, the injured spouse can now sue the negligent spouse and recover from
    the negligent spouse’s insurance company.  It is important to keep in mind that this
    coverage is optional, and not mandatory; therefore the insured must add this
    coverage to their existing insurance policy.
           In order to adequately protect yourself and your family, it is highly suggested
    that you carefully review your automobile polices to ensure that you carry the
    appropriate coverage, and that the coverage is adequate. It is also suggested that you
    consult with your insurance broker from time to time and update your policies.
           In light of the many recent changes to the laws which affect automobile
    insurance policies, if you are involved in an automobile accident, you should consult
    an attorney immediately to protect your rights in a timely manner.

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