Uninsured Motorist Benefits: Availability, Stacking and Rejection

Looking for injury recovery only from one insurance company (the at-fault driver's) is a little like trying to see the entire world through a peephole in a door. In truth, every accident involving a motor vehicle requires careful study of multiple additional, and almost always available, other insurance policies.

Generally, Uninsured Motorist coverage and Under-Insured Motorist coverage (sometimes referred to hereafter as "UM/UIM") are nearly always available. This is true for just about any injury involving a motor vehicle. For instance: if your injuries occurred while you were in a company vehicle, a passenger in someone else's vehicle, riding public transportation, or even a pedestrian, there may be a UM/UIM policy that could be used to help you recover for your injuries. Even if you were out of state when the accident occurred or the at-fault driver has high levels of liability insurance, the UM/UIM policy may be applicable.

In that regard, lawyers who think UM/UIM need only be thought about when a driver is uninsured are probably too inexperienced in the area to properly represent injury victims.

Every Uninsured Motorist coverage is also an Under-Insured motorist coverage. This means when a person is injured by a negligent driver with inadequate insurance coverage to pay fully for the injuries, he can look to UM/UIM coverage to supplement the Defendant's inadequate coverage limits.

Probably the second most fascinating thing about UM/UIM coverage, is the unusual situations where it is available and can be stacked on-top of other available coverages.

To begin with, of course, if you purchased UM/UIM coverage, on your car and you are hit by a negligent driver with small coverage limits, and you have big injuries, that is an easy fit for UM/UIM coverage availability.

But, below is a non-exclusive list of more unusual UM/UIM situations:

1) Passengers can reach the benefits of the driver's UM/UIM coverage:
Passengers occupying a car with UM/UIM coverage are automatically considered eligible for UM/UIM on the car they are riding in even though they may not have purchased the coverage themselves.

2) Passengers of negligent drivers can reach and stack UIM benefits on top of liability benefits, Same Insurance...Double the Recovery:
The passenger in a car driven by a negligent driver can not only collect liability coverage from the driver's policy, but would also be able to stack on top of that UIM coverage of that same policy. That amounts to the availability for double policy limits for this unique circumstance.

3) Passengers can reach UM/UIM through their own, un-involved vehicles and stack it on top of any other already available coverages:
A passenger in a vehicle can not only recover from the at-fault driver and collect against the UM/UIM of the coverage from the car he occupied, but can also reach coverage on the his own vehicle even though the vehicle was un-involved in the subject crash.

4) Drivers of company vehicles can reach UM/UIM benefits found on the company vehicle:
An employee who driving a company vehicle and is the course and scope of his employment at the time of an accident not only has a claim against the at-fault diver and a workers compensation claim, but can also use the UM/UIM coverage of the company vehicle to help him recover for his injuries. Do not worry about the exclusive remedy rule of workers compensation, UM/UIM recovery against the employer's commercial coverage does not violate this rule.

5) Pedestrians hit by motor vehicles can reach UM/UIM coverage on any non-involved vehicle they own:
Pedestrians can reach any UM/UIM coverage on any vehicle they own, even though the vehicle was un-involved in the subject motor vehicle-pedestrian accident. So, even though their own vehicle was parked at home, the insurance on that vehicle may be used to assist them in their recovery.

6) UM/UIM coverage can be reached on any policy owned by any Resident Relative:
An often forgotten consideration for reaching available UM/UIM is any resident relative's coverage. An adult child, who lives with his mother and gets hit by an uninsured driver while a pedestrian, can look to his mother's UM/UIM benefits from the coverage on her un-involved car. If that same pedestrian lives part-time with Mom and part-time with Dad, he can stack UM/UIM as a resident relative from both households. This may seem odd, but coverage applies to resident relatives, so it fits.

The single most fascinating thing about UM/UIM is how hard it is to reject this kind of coverage. Most insurance policies are like picking from a menu. If you didn't purchase it, you won't get it.

However, rejecting UM/UIM requires "the named insured" to sign off in writing expressing the desire to reject this coverage. If "the named insured" has not signed the rejection form, or the insurance company has not retained the documents proving that the named insured rejected the coverage, Colorado law holds that the coverage is automatically provided.

So, even in a case where the insurance company didn't collect a single premium for UM/UIM benefits, if the company cannot prove that the rejection was signed by "the named insured," coverage MUST be provided up to the same level as the policyholder's purchased liability coverage.

That also means that even if an employer intended to reject UM/UIM coverage, but didn't get the rejection signed by the correct person, too bad - your employee gets UM/UIM on any company vehicle they get injured in.

Also, when the law requires "the named insured" to reject and where there are two named insureds, having only "a named insured" reject coverage is inadequate as well. ALL named insureds must have signed the waiver rejecting the coverage in order for the coverage to have truly been waived.

A good attorney looks carefully at UM/UIM rejection documentation (what's called in the industry, their "trailing documents") very vigilantly, as it often doesn't satisfy Colorado requirements. This may be bad news for the insurance company but it is good news for the consumer public.

CONCLUSION:
Uninsured Motorist and Under-Insured motorist coverage are some of the most valuable and cost efficient insurances to have. Further, the number of various scenarios where it is applicable can boggle the mind. A good practitioner needs to carefully consider all the various possibilities regarding UM/UIM and needs to be diligent in following up when the insurance companies claim that coverage was rejected. If you have questions as to whether or not there is a UM/UIM policy that may apply to your case, please call and speak with one of our attorneys at Anderson Hemmat today. We are happy to explore with you all of the potential areas where additional coverage may be found in your case.