By statute, most North Carolina automobile insurance policies are relatively standardize. The state’s General Statute provides the minimum types and coverage amounts that must be offered and/or provided. Other coverages, such as medical payments coverage and additional amounts of coverage, are optional. When a motor vehicle collision causes injuries, at least four types of injury coverage may apply. Those coverages include:
Liability Coverage
Along with property damage coverage, this is the most commonly-known insurance coverage in an automobile insurance policy. Liability coverage protects you if you cause an injury to another party in a collision or are alleged to have caused an injury. Your insurer must provide you with an attorney and pay any judgment up to the amount of the coverage. For example, assume that you negligently fail to yield for a stop sign and cause a T-bone collision that results in the driver of the other car sustaining a broken leg. They will likely present a claim to your insurance company. Your insurer will either:
- Settle the claim within your policy limits,
- deny the claim entirely, or
- fail to reach a mutually agreeable settlement with the claimant.
If the insurance company does not settle the claim, it will likely go to litigation. The insurer will pay the entire judgment if the plaintiff wins a judgment within your policy limit. If the judgment exceeds your policy limits, the insurer will pay up to the limits, and you will be responsible for the remainder.
Medical Payments Coverage
This coverage is optional and is a type of “no-fault” insurance. If anyone (including you) is injured in your vehicle during a collision and has medical expenses, they can be reimbursed for those expenses up to the amount of coverage.
Uninsured Motorist Coverage
“UM” coverage applies primarily in two situations. First, uninsured coverage applies if you are injured through no fault of your own by another motorist without insurance. In that situation, you can sue the at-fault driver, and your own insurer will be responsible for damages up to the amount of your UM insurance limit, which is usually the same as your liability limit. The minimum in North Carolina is $30,000, but it is often sold in other amounts, including $50,000, $100,000, and $300,000. You may also negotiate directly with your insurer before filing suit. UM coverage further protects you in the event a hit-and-run driver injures you. If there is “physical contact,” you can proceed against your own policy, whether or not you can identify the other driver.
Underinsured Motorist Coverage
“UIM” coverage protects you if you are injured by someone who has less liability coverage than you have UIM. Assume, for example, that you own $100,000 in underinsured motorist coverage and are injured in a rear-end collision by a driver with a $30,000 liability policy. Assume you have $65,000 in damages, including medical expenses, lost wages, and pain and suffering. The at-fault party’s insurer is responsible for paying only $30,000 of your damages. Then you may then proceed against your own policy to recover the remaining $35,000.
This is, of course, a simplified overview of North Carolina automobile insurance coverages. Any number of issues and exclusions could affect an individual situation and your ability to recover. If you have been injured in an automobile accident, set up a free consultation with a personal injury attorney. Our attorneys offer free consultations and will travel to meet with you. Additionally, you pay no attorneys’ fees unless and until we obtain a settlement or verdict.We represent clients across the Carolinas from our offices in Raleigh, Charlotte, and Fayetteville. Contact us today to connect with our staff of dedicated legal professionals.
