North Carolina Auto Insurance – A Basic Overview of Coverage

When potential clients come into our office and tell us that they have been injured in an accident, one of the first questions we ask is, “do you have med pay coverage?”. Occasionally, someone knows whether they do or not, but more often than not, we get a puzzled look and the potential client tells us that he has no idea what we are talking about. Only then does one realize the importance of this type of coverage. Because it is not required in North Carolina, we find many people do not have it and are not sure what it even is or when it applies. This article will explore the basics of the different types of insurance coverage available in North Carolina auto insurance policies, what they pay for, who is covered and whether you are required to purchase it as a North Carolina driver.

LIABILITY COVERAGECOVERS INJURIES AND PROPERTY DAMAGE TO ANOTHER PERSON OR THING

When someone is responsible for causing an accident, liability coverage is insurance that will pay for damages or injuries to the other involved person or vehicle. In other words, liability coverage pays for bodily injury or property damage which a covered driver is legally obligated to pay. This coverage is required for all private passenger vehicles registered in North Carolina, and it covers the name insured, the named insured’s family and anyone who is operating the named insured’s vehicle with his or her permission. To meet the minimum limits, you must have at least the following liability coverage:

  • $30,000 of coverage for injuries or death involving one person in a single accident.

  • $60,000 of coverage for injuries or deaths involving two or more people in a single accident.

  • $25,000 of property damage coverage.

These amounts are generally represented as $30,000/$60,000/$25,000. Failing to carry enough insurance can put your personal assets at risk if you cause injury or damages to someone else or to something else. You should consult with an insurance professional or contact one of our lawyers for an insurance evaluation based on your personal circumstances. It is crucial that you have adequate liability insurance coverage to protect you in the event of an at-fault accident.

UNINSURED MOTORIST COVERAGE (UM)/UNDERINSURED MOTORIST COVERAGE (UIM)UM COVERAGE COVERS YOUR BODILY INJURY OR PROPERTY DAMAGE; UIM COVERS BODILY INJURY ONLY

Uninsured motorist coverage (UM) and underinsured motorist coverage (UIM) are two of the most important types of insurance you can carry. Why? This protects YOU in the event that you are injured in an accident with someone who does not have insurance or who doesn’t have enough insurance to compensate you for your damages. This is coverage that you can pay for to protect yourself, your family, or anyone occupying your covered automobile if you are injured in an accident. In North Carolina, auto insurance policies with the minimum bodily injury and property damage limits ($30,000/$60,000/$25,000) are required to include uninsured motorist coverage. Policies with the limits greater than the minimum must provide combined uninsured/underinsured motorist coverage. Here is where this gets tricky: your UM/UIM coverage only comes into play if you have MORE coverage than the at-fault driver. For example. If you are injured in an accident and the at-fault driver has $50,000 in liability coverage, a $50,000 UIM policy does not provide any additional coverage for you. However, if you had a $100,000 UIM policy, you would have an additional $50,000 in insurance coverage available to you to compensate you for injuries if your damages exceeded the first $50,000 available from the at-fault driver. This coverage is so important if you are injured in an accident with a driver who does not have any insurance coverage or who doesn’t have enough insurance coverage to fully compensate you for injuries.

MEDICAL PAYMENTS (MED-PAY) COVERAGE

You are not required to purchase med-pay coverage in North Carolina. However, you should; and, you should purchase the maximum amount your insurance policy will allow that you can afford. Why is that? This coverage pays for reasonable and necessary medical and funeral expenses for you and your family and anyone occupying your vehicle in a collision. This coverage is so incredibly important because your insurance carrier will pay for treatment that is reasonable and necessary following an accident. It’s money that is generally available once the cost of treatment is incurred and can be used almost immediately to help pay on medical expenses as opposed to waiting until your case is settled or litigated and determined at a trial. We recommend everyone purchase this insurance if it is in your budget even though North Carolina does not require it.

COLLISION COVERAGECOVERS PROPERTY DAMAGE TO YOUR VEHICLE FROM A COLLISION WITH VEHICLE OR OBJECT

Collision coverage covers damages to your vehicle when physical damage occurs from a collision with another vehicle or object. It is generally subject to a deductible and the higher your deductible, the more you will have to pay out of pocket to avail yourself of this insurance coverage should you need to use it. This coverage is not required in North Carolina by law, but a lender may require it.

COMPREHENSIVE COVERAGECOVERS PROPERTY DAMAGE TO YOUR VEHICLE FROM NON-COLLISION INCIDENT

Comprehensive coverage is also used to repair damages to your vehicle when property damage occurs to it from non-collision related incidents. For example, this coverage applies if your vehicle is damaged by: missiles or falling objects; fire; theft; larceny; explosion or earthquake; windstorm; hail; water; flood; malicious mischief; civil commotion; contact with a bird or animal; breakage of glass. This coverage, like collision coverage, is not required in North Carolina by law, but a lender may require it. Also, like collision coverage, comprehensive coverage is generally subject to a deductible.

If you would like to speak with an attorney about your insurance coverage, or if you have been injured in an accident and need an attorney who is experienced in maximizing recoveries from insurance companies, contact our office today.

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