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Understanding Your own Car Insurance Coverage

Your automobile insurance company should send you a Declaration page or “DEC” sheet with your insurance policy information (and typically a bill) at least once a year.

Your DEC page/sheet lists the types and amounts of coverage you have.

What is “Bodily Injury” (BI) Liability Insurance Coverage?

New York drivers are required by New York law to have “Bodily Injury” or “BI” coverage as part of their automobile insurance policy. Bodily Injury coverage compensates an injured person due to a driver’s negligent operation of a vehicle if the person’s injuries meet the “Serious Injury” threshold as defined by New York law. This is the type of coverage that would pay you for your “pain and suffering” as well as damages not covered by No-Fault insurance.

What is the Minimum “Bodily Injury” (BI) Coverage Required?

In New York, vehicles are only required to have a minimum of $25,000 per person and $50,000 per accident in automobile coverage.

Can a person have more “Bodily Injury” (BI) liability coverage than $25,000/$50,000? Absolutely, everyone has the option of paying for higher BI coverage but it is common for vehicles in New York to have just the bare minimum coverage as it is the most affordable.

With minimum “Bodily Injury” (BI) liability coverage, regardless of how catastrophic your injuries are, the most you can recover from the negligent driver’s insurance is $25,000.

Also, regardless of the number of people injured as a result of the negligent driver’s actions, the most that can be recovered in total from the negligent driver’s insurance carrier is $50,000, which must then be divided among the injured people.

Example: A family of six is rear-ended by a negligent driver and all six family members are seriously injured. Those six people would have to divide up a total maximum amount of $50,000.

There is a way to ensure that you have insurance that covers you and your family in the event that a negligent driver has no insurance or the minimum $25,000/$50,000 “Bodily Injury” (BI) amount. This coverage is called Supplementary Uninsured/Underinsured Motorist (SUM) coverage.

What is Supplementary Uninsured/Underinsured Motorist (SUM) Coverage?

New York law requires every insurance carrier to offer Supplemental Uninsured/Underinsured Motorist (SUM) Coverage.

SUM coverage is extremely important as it could pay you (and your passengers) if you are seriously injured by a negligent driver who is underinsured (minimum $25,000/$50,000 policy), uninsured (no insurance), driving a stolen vehicle or commits a hit and run against you.

Under your own auto insurance policy, you have the option of choosing higher coverage to provide more protection for you and your passengers. Supplementary Underinsured Motorist (SUM) coverage provides a significant increase in coverage available to pay you and/or your family/passengers injured by an uninsured, underinsured (only $25,000/$50,000), or hit-and-run driver.

How much can you increase your SUM coverage above the minimum $25,000/$50,000 to protect you and your family?

Every insurance carrier is different, however, typically the options are:

  • $50,000 per person and $100,000 per accident
  • $100,000 per person and $300,000 per accident
  • $250,000 per person and $500,000 per accident
  • $500,000 per person and $500,000 per accident

Some insurance carriers offer SUM coverage up to $1,000,000.

Yes, increasing your SUM policy limits will increase your premium, however, typically it is not as much as you would think. At a bare minimum, ask your insurance agent for a quote!

How Does SUM Coverage Work?

The negligent driver’s Bodily Injury (BI) coverage would pay you first and then we would make a claim against your own auto policy for the SUM coverage you already paid for.

The claim against your own SUM coverage would be for the difference between the negligent driver’s BI limits and what your own SUM policy limit is.

Example: If you have SUM coverage of $100,000 per person and $300,000 per accident and are rear-ended by a negligent driver and suffer serious injuries, you would be paid the negligent driver’s $25,000 policy. We would then make a claim against your own SUM coverage for the difference between the two policies. You could receive up to another $75,000 from your SUM policy ($25,000 + $75,000 = $100,000 total SUM limit) if your injuries were valued as such.

Example: Assume you have SUM coverage of $100,000 per person and $300,000 per accident. You are traveling with your family of six, when you are rear-ended by a negligent driver and all six passengers are seriously injured. Your family would receive the $50,000 from the negligent driver’s BI coverage and we would make a claim against your own SUM coverage. Your family of six could receive another $250,000 from your SUM policy ($50,000 + $250,000 = $300,000 SUM limit) to divide amongst your family.