In Pennsylvania, when purchasing auto insurance, you have a number of options to consider. While auto insurance is required to operate a vehicle in Pennsylvania, the insurance company is not required to explain to you which insurance coverages are better and which insurance coverages are worse. Simply put, the purchase of auto insurance Pennsylvania is "buyer be ware."
There are four primary components to every auto insurance policy sold in Pennsylvania and understanding each is critical to you and your loved ones if you are ever involved in Pennsylvania car or truck accident. The four major components include: 1. Liability Coverage 2. Uninsured/Underinsured Motorist Benefit Coverage (UM/UIM) and 3. Full Tort/Limited Tort Coverage 4. Medical Benefits Coverage (PIP).
1. Liability Insurance
Liability insurance refers to the amount of money that your insurance company will pay if you are responsible for the car or truck accident. In Pennsylvania, all drivers are required to maintain minimum liability coverage of $15,000 per injured person and $30,000 per accident in total.
It is important to understand that as part of your liability insurance, your insurance company will pay for an attorney to defend you and will pay the judgment against you up to the limits of the liability insurance stated on your declarations page. If you have found yourself facing a lawsuit or have been contacted by the other driver's attorney, it is extremely important that you contact your auto insurance company immediately so that they may retain counsel to represent you.
2. Uninsured/Underinsured Motorist Benefit Coverage
Uninsured motorist coverage typically referred to as UM coverage, protects you and your family in the event that you and your family are involved in an accident with a uninsured motorist. An uninsured motorist can be someone who is not maintain liability coverage, a drunk driver who does not maintain auto insurance or a hit and run driver who flees the sign of the accident. The UM coverage is provided by your own auto insurance policy and is another source of compensation available to you in the event you are injured by a uninsured or hit and run driver.
Underinsured motorist coverage (UIM), protects you and your family in the event that the at fault driver does not carry enough insurance to compensate you for your injuries. As I mentioned previously, Pennsylvania law only requires that a driver maintain minimum auto insurance coverages limits of $15,000/$30,000. Most auto accidents where someone has sustained injuries exceed the minimum required limits and that is why it is extremely important that you maintain UM/UIM coverage limits that will adequately compensate you or a family member in the unfortunate event that you are involved in an auto accident. At The Rehmeyer Law Firm, we recommend maintaining UM/UIM coverage limits of $100,000/$300,000. This means that you will have up to $100,000 per person and $300,000 in total per accident. Often the cost of maintaining appropriate UM/UIM coverages is minimal, but the cost of not doing so could be catastrophic.
3. First Party Medical Benefits (PIP)
First party medical benefits refer to coverage that your auto insurance company will provide you in the event that you are injured in a car or truck accident. Pennsylvania is a no-fault jurisdiction, which means that your auto insurance company is required to pay for your medical bills and damage to your car or truck regardless of whether you caused the accident or not. If you maintain health insurance or a group health insurance plan through your employer or on your own, it is not necessary to maintain PIP coverage beyond the minimum amounts offered by your auto insurance carrier. This is because once you have exhausted the limits of your PIP coverage, your personal health insurance company will pay your medical bills. If you do not have health insurance or your plan does not provide adequate coverage, it would be a good idea to increase your PIP coverage beyond the minimum amount offered by your auto insurance company.
4. Full Tort/Limited Tort Coverage
If you read nothing else on this website, I urge you read this, and that is the difference between Full Tort and Limited Tort coverage. After you have read this post, I want you to go home and look at your auto insurance policy declarations page. The declarations page should be provided to you yearly when you renew your auto insurance policy and lists out the specific coverages and coverage limits of your auto insurance policy. Please look to see if you have elected "Full Tort" coverage, and if your auto insurance policy does not state Full Tort, I want you to call your auto insurance agent and ask that you change your policy to include full tort coverage. Typically, Limited Tort auto policies are anywhere from $100 to $200 cheaper than a comparable Full Tort auto insurance policy. However, what you are giving up in many instances can be worth thousands of dollars down the road.
In order to understand the difference between Full Tort and Limited Tort coverage, it is important to understand what you are not getting with a Limited Tort policy. With a Limited Tort auto insurance policy, you give up the right to receive compensation for pain and suffering if you are injured in automobile accident. In most car accidents, the primary compensation that you are entitled to receive is for the pain and suffering you have to endure as a result of the car accident. The only benefit to a Limited Tort auto insurance policy is that it cheaper than a Full Tort auto insurance policy. What's also important to realize about Limited Tort auto insurance policies is that you are not just limiting yourself to receive just compensation in the event you are injured while driving your own car, but you are also precluding your family members covered under the policy from receiving adequate compensation. Even more significant, you and your family members will also be precluded from recovering for pain and suffering if you are injured while riding in someone else's vehicle.