Underinsured Motorist Coverage is coverage that kicks in when the at-fault driver’s insurance is insufficient to cover your losses. UIM coverage is an important component of auto insurance that provides financial protection when damages exceed the at-fault driver’s policy limits.
UIM coverage is optional in Georgia, but insurance companies are required to offer it to policyholders when they purchase auto insurance.
When Does UIM Coverage Apply?
UIM coverage applies in situations where the at-fault driver’s liability insurance coverage is insufficient to cover the injured party’s damages. For example, if the at-fault driver has liability coverage with limits lower than the injured party’s UIM limits, the injured party’s UIM coverage can help bridge the gap between the at-fault driver’s coverage and the total amount of damages incurred.
Underinsured Motorist Coverage in Georgia
Here’s how Underinsured Motorist Coverage works in Georgia.
Coverage Limits
UIM coverage is optional in Georgia, but insurance companies are required to offer it to policyholders when they purchase auto insurance. Policyholders have the option to accept or reject UIM coverage, and they can select coverage limits based on their individual needs and budget.
Stacking Coverage
In Georgia, policyholders have the option to “stack” their UIM coverage if they have multiple vehicles insured under the same policy or multiple policies with the same insurance company. Stacking allows policyholders to combine the UIM coverage limits for each insured vehicle or policy, providing higher coverage limits in the event of an accident.
Offset Provisions
Georgia law includes provisions that allow insurance companies to offset the amount of UIM coverage by the amount already paid by the at-fault driver’s liability insurance policy. This means that the injured party’s UIM coverage may be reduced by the amount received from the at-fault driver’s insurance, preventing the injured party from “double-dipping” and receiving more than their total damages.
Underinsured Motorist Claim Process
Filing a Claim
To access UIM coverage, the injured party typically needs to file a claim with their own insurance company after exhausting the liability coverage limits of the at-fault driver’s insurance policy. The injured party must demonstrate that their damages exceed the at-fault driver’s policy limits and that the at-fault driver’s liability coverage is insufficient to fully compensate them for their losses.
Negotiating a Settlement
In UIM claims, insurance companies have a duty to handle claims in good faith and fairly evaluate the injured party’s damages. However, disputes may arise between the injured party and their insurance company regarding the value of the claim or the extent of the damages.
In such cases, the injured party may need to negotiate with their insurance company or seek legal assistance to resolve the dispute and obtain fair compensation.
Legal Recourse
If the insurance company denies or undervalues a valid UIM claim, the injured party may have legal recourse to pursue a bad-faith insurance claim against the insurer. Bad faith claims allege that the insurance company acted unreasonably or unfairly in handling the claim, such as by denying coverage without valid justification or delaying payment of benefits.
Summary
Underinsured Motorist Coverage in Georgia provides important financial protection to policyholders in the event of accidents involving at-fault drivers who do not have sufficient insurance coverage to fully compensate the injured party for their damages.
Understanding how UIM coverage works and the options available under Georgia law can help individuals make informed decisions when purchasing auto insurance
