How do Uninsured and Underinsured Motorist Claims Effect my Premiums?
A client came to us with an all-too-common problem. She had sustained very serious injuries necessitating a surgery and a long road to recovery. The injuries and medical bills were so extensive that the Defendant’s insurance had already accepted liability for the incident before our involvement! The insurance company had offered the full extent of its policy limits: $100,000. Unfortunately, that amount paled in comparison to the client’s damages. The medical bills alone exceed $100,000. And what about pain and suffering? Loss of normal life?
“What can we do?”
The answer is Underinsured Motorist coverage, which on average costs less that $20 per month in premiums on your auto policy. This coverage protects you against drivers without sufficient insurance to cover the full extent of your damages, such as our client here. While the other driver’s $100,000 policy is a lot of money, it did not even begin to cover our client’s full damages. That’s when we recommend turning to our client’s own policy to make up the difference.
“But if I make a claim, won’t that raise my rates?”
The reality is that your rates are raised annually anyway. In 2024, Illinois auto insurance rates rose 18% in 2024, with an additional increase of 4%+ expected in 2025. (See Fox32 Chicago, https://www.fox32chicago.com/news/illinois-auto-insurance-crisis-poor-credit-zip-code-could-cost-you-thousands). The average Illinois driver now pays $2,000 annually for full auto insurance, and that continues to rise.
The good news in this case was that the client had great Underinsured Motorist coverage through her own auto policy, providing her access to an additional $400,000 in coverage for these injuries. In obtaining that $400,000 in coverage for the client, it would take several life times for any increase in premiums to surpass the $400,000 check the insurance company just wrote our client.
Making a claim for Uninsurance or Underinsured Motorist Coverage (UM/UIM) is insurance policy specific and can be confusing with certain time-bound requirements. If you believe you have been hit by an uninsured or underinsured motorist in Illinois, contact our office immediately to discuss your options by emailing info@aaglawgroup.com or calling 312-500-0707 for a free consultation.