By HAWLEY HOLMAN
Automobile insurance is generally provided by a standard policy of insurance promulgated by the Texas Department of Insurance (TDI). However, insurers are now permitted to apply to the /TDI for permission to vary the standard form. TX. Ins. Code Art. 5.142. Thus, it is very important to obtain a copy of the policy to review the exact language. Generally, the automobile policy will have several parts as follows: Collision, Liability, Uninsured/Underinsured Motorist Coverage, Personal Injury Protection Coverage (PIP) Medical Payments Coverage (Med Pay) as well as many possible endorsements. It is important to consult the Declarations page of the policy to determine the different types of coverage.
Texas law requires that each person who drives a car on the roads demonstrate financial responsibility which means that the driver must have at least $20,000 in bodily injury liability coverage per person; $40,000 bodily injury coverage per accident; and $15,000 property damage per accident. Whenever a driver from another state operates a vehicle and that state requires less in coverage than Texas that policy generally requires that the policy comply with the minimum financial responsibility laws of the state where the accident occurred.
Agreement – This section of the policy provides definitions used throughout the policy. Courts have determined the meaning of these definitions and in some cases there can be differing court opinions.
PART A - Liability Coverage Insuring Agreement- This section generally says that the policy will pay for damages for which a covered person becomes legally responsible because of an auto accident. This section defines who a covered person is, describes Supplemental Payments and also lists Exclusions which identify events or acts which are not covered.
Part B1 - This section discusses Medical Payments Coverage which basically says that the policy will pay reasonable expenses incurred for necessary medical and funeral services because of bodily injury and also provides for exclusions from medical payments coverage.
Part B2 - This section discusses Personal Injury Protection Coverage which basically says that the policy will provide for medical expenses to be paid directly to a physician or other health care provider upon receipt of a written assignment signed by the covered person to whom the benefits are owed. This section also includes exclusions from PIP coverage. PIP coverage is no-fault coverage to provide for the immediate expenses arising from physical injuries due to an automobile accident.
PART C - This section describes the Uninsured/Underinsured Motorist Coverage. UM/UIM coverage must be included in every policy unless it is rejected in writing by the insured. There is uncertainty over whether an initial rejection is valid against a renewal policy. The better practice for an insured is to make sure that you have UM/UIM coverage because it is coverage that you are providing for you and your family members or other covered persons against the negligence of another operator who has no insurance or inadequate insurance to cover damages caused by the negligent operator. UM coverage protects an insured for damages caused by the negligence of an uninsured driver or a hit and run driver. UIM coverage provides protection for an insured caused by the negligence of another driver whose liability coverage is insufficient to make the insured whole or cover all of the injuries and damages. This is insurance which the insured takes out to protect himself and his family or other covered persons from a UM/UIM driver. The case law appears to indicate that punitive damages are not covered under UM/UIM coverage. One caveat for UIM coverage is that an insured must get consent from the UIM/UIM carrier for the insured to settle with the liability carrier for the underinsured motorist. Lawyers who do not regularly handle motor vehicle accidents may not know this requirement or may not even think about making a UM/UIM claim for you. There are many different definitions and requirements in the UM/UIM section of the policy as well as exclusions which means that anyone having a potential claim under these provisions needs an attorney who is very familiar with and has handled many claims of this type. I have seen situations where attorneys unfamiliar with automobile policy requirements settled with the liability carrier for the negligent driver without obtaining permission from the UM/ UIM carrier only to have UM/UIM coverage rejected for failure to obtain permission required by the policy.
Part D - This section provides coverage for damage to your auto. This section is coverage you provide to yourself for direct and accidental loss to your auto.
Endorsements - These are additional coverage provisions which may be added to a policy. You must look at your policy to determine the applicable endorsements and their contents.
The Prompt Payment of Claims Act (Art. 21.21, Texas Ins. Code). This act provides a set of timelines which are now part of every standard form policy written in Texas. If an insured does not comply with Article 21.55 it could be responsible for 18% interest and reasonable attorney’s fees.
PIP OFFSET - Since PIP and UM/UIM both allow payments for medical expenses, questions have arisen though the years over the offset issue. In 1999 the Texas Supreme court allowed an offset of PIP payments against UM/UIM coverage to the extent it prevents double recovery. In other words, it the person’s claim is less than the UM/UIM limits the carrier can take an offset but if the damages exceed the UM/UIM coverage the carrier can’t offset where it would reduce the UM//UIM coverage below minimum limits. It does not limit stacking of PIP and UM to cover actual damages.
Automobile litigation is very complicated and involves many different issues which must be addressed with respect to accidents especially if several people are injured in one accident. In this situation, an attorney will need to investigate every possible policy of insurance or source of coverage for the injured person or persons. For example, a child injured in a motor vehicle accident and who has divorced parents could possibly be covered under both parents policies of insurance assuming they both have UM/UIM coverage. In Hartford Cas. Co. vs Philips, the court held that a child of divorced parents can be a member of both parents’ households and be potentially covered under both policies. With joint custody the norm in Texas now it stands to reason that any attorney handling you case should be asking for copies of all potentially applicable policies of insurance. There are many aspects of auto coverage issues and ensuing litigation. Automobile carriers hire very experience litigators who are familiar with the complicated issues in automobile litigation. Why shouldn’t you retain someone who also has the same experience to represent you or your family member in an accident involving injuries? Since I have been hired through the years by more than 100 insurance carriers this experience has helped me represent hundreds of injured persons against negligence drivers and their insurance companies as well as against the injured person’s own insurance company for UM/UIM claims. REMEMBER, when you are making a claim the other driver’s insurance company is NOT your friend; and your own insurance company may not be your friend once it learns that you may be making a UM/UIM claim under you own policy which you bought and paid for. Do you really want to trust and insurance company to treat you fairly when its adjusters are looking for ways to either avoid paying you or underpay you? Most insurance companies use artificial intelligence known as Colossus to evaluate claims. Yes, they input certain data [and maybe even not all of the medical data] into computers and they let a computer tell them what your broken arm; scars; knocked out teeth; injured vertebra, etc is worth when it comes to settlement. Some literature says that the artificial intelligence doesn’t even include all of the ICD codes so that all injury codes are not available in the program. If all of the injury codes are not available how could there allegedly be a fair evaluation in the first place? ANSWER THIS QUESTION: Do you want to trust an adjuster who is trying to underpay you and who may be using an artificial intelligence computer to evaluate your claim, or do you want a Personal Injury and Civil Trial Board Certified Attorney who has handled hundreds and hundreds of these types of cases from both sides to represent your interests?
Contact me today!