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Underinsured Motorist Coverage in Texas

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Underinsured Motorist Coverage after an accidentWhat if you are in an accident with a driver without insurance? Or your automobile accident and have suffered very severe injuries, and the driver of the vehicle responsible for the accident has only a minimum insurance policy?

In Texas, you must be offered uninsured and underinsured motorist coverage insurance by your insurance company. Purchasing such coverage is recommended in Texas. The reason we recommend you buy underinsured and UIM coverage is because the odds of getting into an accident with someone with no insurance or in a more severe crash with someone who only maintains a minimum policy are significant.

What is Uninsured Motorist Coverage?

Uninsured motorist coverage is insurance you purchase as an option on your auto insurance policy. Uninsured motorist coverage protects you if you get in an accident with a driver without insurance or someone with insufficient coverage to pay you fair compensation for injuries.

Texas Uninsured / Underinsured Insurance Claims.

If you are involved in an accident with someone not covered by car insurance, you might discover it at the crash scene. Sometimes, the driver will tell the police they don’t have coverage and be ticketed for no insurance. Other times the at-fault driver will produce an insurance certificate, but you later discover that the coverage had lapsed.

Uninsured Motorist (UM) coverage provides insurance benefits if you are in an accident with someone at fault but do not have insurance coverage. Contact between the vehicles is required. Even in a hit-and-run accident, your uninsured motorist coverage will apply if the other driver was at fault and hit a car where UM covered an occupant. 

Underinsured Motorist (UIM) coverage applied when the driver of the at-fault vehicle did not have sufficient liability coverage for you all of your damages. UIM stacks on top of the at-fault driver’s liability coverage up to your losses but never above the UIM policy limits. There are two optional types of coverage you want to consider in Texas. They are UM and PIP.

Passengers can use UIM coverage on their vehicle and UIM coverage for the driver of the car they are a passenger in unless all vehicles are under the same policy.

Many situations exist where there can be more than one underinsured/uninsured motorist claim.

What is the Stacking of UIM coverage?

Stacking is a situation where someone is covered by more than one insurance policy and seeks to add the policies together to recover the maximum sum.

In State Farm Mut. Ins. Co. v. Conn, 842 S.W.2d 350 (Tex. App. 1992), the court held that passengers could not stack UIM benefits of the vehicle in which they were a passenger and also claim liability coverage from that driver. The innocent passengers could not make both underinsured claims and liability claims under the same policy.

However, the stacking of underinsured coverage is permitted when there are multiple layers of UIM coverage.

Can the insurance company offset PIP?

Under the standard Texas personal auto policy, an insurer may receive a credit for the PIP benefits paid under the UM coverage. However, recent case law has clarified the limits to credit by the insurance company for the PIP they have paid.

PIP offset cannot be taken if your damages exceed the combined PIP and UM policy limits. If your damages exceed the uninsured motorist coverage plus PIP coverage, the insurer may not offset them. Meaning deducting the PIP they paid from your UIM settlement.

The dilemma for the insured is that many Texas insurance companies will dispute the damages and claim offset unless your medical expenses exceed all insurance. In most personal injury cases, pain and suffering, disability, and disfigurement are almost always more significant than the medical bills themselves, which were incurred to treat the injuries.

How to Get Uninsured or Underinsured Benefits in Texas?

What are the two elements needed for an underinsured or uninsured motorist claim?

  1. The insured must prove fault by the on or underinsured driver.
  1. The insured must also prove legal damages before they are entitled to UM or UIM motorist benefits.

Case law under Brainard v. Trinity Universal Insurance Co., 216 S.W.3d 809 (Tex. 2006), places the burden on the personal injury victim to prove in court their damages before the UM or UIM carrier has to pay. This new case law requirement has allowed insurance companies to play hardball with their own insured, by forcing their insured to file expensive lawsuits to get the benefits of coverage they paid for.

Before Brainard, holding insurance companies accountable for bad faith efforts with their own insured was much more straightforward. However, like a toddler who can never be punished, in Texas, allowing insurance companies to abuse their policyholders without legal consequences has led to an increase in lawsuits that should not have been necessary.

Uninsured Motorist Coverage is Recommended in Texas

Regardless of why the insurance policies cost so much in the state of Texas, buying uninsured motorist coverage is essential when living in the state of Texas. Estimates place as many as 1/4 of all drivers in Texas as having no current insurance coverage for their vehicle. And collecting outside a liability policy from a negligent driver’s pocket is difficult and often fruitless.

The First Step- Contact Your Own Auto Insurer

If you are hit by an uninsured driver who caused the accident, the first step is to contact your own insurance company and make a claim on your policy as long as you have either collision coverage or underinsured motorist coverage. State Farm, Geico, Allstate, and the rest are generally helpful to their own insureds after a crash.

Uninsured Coverage would Protect You if the Other Driver Were Uninsured

Uninsured motorist coverage puts your own insurance company in the place of the uninsured motorist’s insurer in that they will pay what the uninsured motorist is legally obligated to pay. In essence, this means that whatever legal damages you have incurred will be covered by your own policy (subject to the terms and limitations of your policy). Your insurer will be free to pursue the uninsured driver to get back the money they paid out, should they so desire. However, many times the insurer does not pursue an uninsured driver.

Cases Against Your Insurer Requires an Attorney

Recent case law has made it more difficult for families to prosecute uninsured motorist claims in Texas and hold their insurance company reasonably accountable for bad faith or abusive claim-handling practices.

In essence, in some instances, the family in Texas is required to go to trial and get a jury or judge’s verdict to perfect their right to uninsured motorist benefits, and your insurer is fighting in court to deny you compensation.

The first step to take when you are injured in an accident with an uninsured driver is to check the insurance policy for your vehicle to see if you have coverage that may help. The next step will be to speak to the best personal injury attorney you can find about your case and how to move it forward.

We recommend you speak with a reputable auto accident attorney in Houston as soon as possible and before giving any written or recorded statement to any insurance company.

If You Don’t Have Full Coverage Insurance

If you do not have full coverage on your own auto policy after being in an accident with an uninsured driver, justice may be difficult to find. There are limited options available here they are:

  • Try to find a personal injury lawyer to help. This will be tough because most successful personal injury attorneys don’t want the risk of being unable to collect after winning the case. But you have nothing to lose IF you can get a lawyer.
  • Go to small claims court yourself. This option is open, but if a lawyer is not willing to invest time and money in your case (because they worry they are wasting both time and money) do you REALLY want to pursue a case?
  • Try to identify another insured party who might have responsibility for the wreck. An example could be a friend letting a drinking driver borrow his car- a negligent entrustment case may be an option.

Have Questions About an Accident? Call our Experienced Auto Accident Attorneys in Houston.

Unfortunately, given the difficulties in claiming with their own insurance company for benefits they paid for, hiring a car accident lawyer is almost always required.

If you have questions about an auto policy, a Texas car accident, or a personal injury claim in Harris County, Texas, call us for a no-obligation consultation at 281-587-1111.