You are driving home from work at 7:00pm on a nice clear winter evening, excited to get home to see your spouse and children before they go to sleep. You are only two minutes away from your home, and you stop at the red traffic light that you always seem to miss just before arriving home. After a long day at the office, having a home cooked meal with your family is the perfect remedy. Unfortunately, the person operating the car behind you went out drinking after work, had too many drinks and crashes at full speed into the back of your vehicle. You sustain neck and low back injuries that eventually require surgery, and your entire life is turned upside down. At least the person that rear-ended you had car insurance, so you should be fairly compensated for your injuries, right? Not necessarily. . .
Pennsylvania and New Jersey remain behind the majority of states regarding bodily injury and uninsured/underinsured motorist insurance minimums. Despite efforts for several years in Pennsylvania to raise these minimum insurance limits (which have been in the place since 1974), the minimum bodily injury liability limits are $15,000 per person/$30,000 per accident. New Jersey, who carries the same policy amounts as Pennsylvania, has not changed their amounts since 1972. Most states have at least $25,000 per person/$50,000 per accident of bodily injury insurance minimums, including New York, New Hampshire, Rhode Island, Virginia, and Ohio. In 2011, Maryland passed a law raising their minimum bodily injury liability requirements to $30,000 per person / $60,000 per accident. In April of 2017, I testified in Delaware in front of the full Senate and Committee in the House Of Representatives (testimony in front of the full House of Representatives was not necessary) regarding House Bill 114, which sought to increase the bodily injury limits from $15,000 per person / $30,000 per accident to $25,000 per person / $50,000 per accident. The bill passed the House of Representatives and the Senate, and was signed by Governor Carney on July 13, 2017. This new law allowed 6 months for insurance companies to change their policies and went into effect December 13, 2017, whereby all motor vehicle insurance policies written in Delaware after this date have minimum bodily injury policy limits of $25,000 per person / $50,000 per accident.
Consequently, because Delaware requires that uninsured /underinsured motorist policy limits be offered at the minimum level of bodily injury policy limits, all uninsured/underinsured motorist policy limit minimums also start at $25,000 per person / $50,000 per accident as of December 13, 2017.
Honestly, even $25,000 per person / $50,000 per accident of bodily injury and uninsured/underinsured motorist coverage will not adequately protect you or anyone in your car if catastrophic injuries are sustained in an accident. But the goal is to increase insurance minimums as high as possible while still maintaining the balance in premium increase to make car insurance as affordable as possible. The majority of states (33 at this time) have minimum bodily injury requirements of $25,000 per person / $50,000 per accident. Any state with less coverage has simply not caught up with inflation, the increasing costs of medical expenses, and the standard of living. Moreover, raising minimum insurance requirements will benefit the State, the Federal Government, private health insurance, medical providers, and the victims injured in motor vehicle accidents. Higher insurance policies results in more money available, which in turn provides a larger pot of money to pay all interested parties affected by loss. For example, State Medicaid, Medicare or private health insurance usually cover medical bills for treatment incurred by the injured party once personal injury protection benefits have been exhausted. These health providers may have a lien that they attempt to recover out of the third party case, but if insurance money is limited, there may be nothing for them to recover. With more money available following a loss, the lienholders will have more to recover. States are struggling each year to balance their budgets, and if money can be reimbursed to Medicaid, this will help States when it comes down to crunch time. Similarly, medical providers with outstanding balances will also have more money to collect for treatment rendered to the car accident victims.
Most importantly, having a larger sum of money available will help fairly compensate injured victims. To be clear, innocent victims of car accidents will not receive a windfall simply because of more insurance available. Rather, people will get closer to what they deserve to fairly compensate their injuries.
Opponents (the insurance industry) will argue (as they did in Delaware) that raising premiums will mean less people purchasing car insurance and more uninsured drivers. However, Maryland raised their insurance minimums in 2011 and has not seen a noticeable increase in uninsured drivers. In Delaware, the increase in premiums will be minimal, and the amount of increased coverage is significant. In Pennsylvania and New Jersey, with a population of 12.8 million and 9 million people respectively, and multiple major high-speed roadways stretching across the states, the risk for more significant accidents and injury is even higher. There is no reason for insurance minimums to be consistent with economic state of the 1970s and 1980s. Pennsylvania and New Jersey must fight to increase minimums to be on par with the rest of the country.
- Lawarance Kimmel, Esq.
