AUTOMOBILE INSURANCE: BORING FOR SOME, IMPORTANT FOR ALL

If you have made it this far (i.e. past the title), it is fair to assume that you are in the unfortunate position of needing to know something about your automobile insurance policy.  People hate fine print (hereinafter referred to as "fine print").  People also do not use fine print.  Unlike people, insurance companies have a fetish for fine print, and you will find fine print in any document provided to you by one.  Here is a common approach by an insurance company:

Step 1:  Write insurance policies using fine print and other techniques to permit the withholding of expected benefits.  

Step 2:  Sell those insurance policies using confident, reassuring slogans with a personal touch. Examples are everywhere: (http://www.amfam.com/default.asp; http://www.statefarm.com/; http://www.allstate.com/).   

Photo by Peds

Fine print matters.  In a recent case my client was walking across a street in a crosswalk and was struck by a minivan.  She had bad injuries.  She had torn ligaments in her knee and needed surgery. She also did not have health insurance.  For my client to get the surgery she needed it was very important that we identify other coverage. Fortunately, we were able to find applicable Personal Injury Protection coverage in the minivan driver's insurance policy.  That policy clearly provided for Personal Injury Protection benefits covering my client as a pedestrian for up to $35,000 of medical treatment. This wasn't money for her to keep, it went directly to her medical providers to pay for her important medical treatment.  My client also needed other benefits that we believed were provided by the insurance policy.  First, she needed "essential services," which would include payment to the people that were helping her buy groceries and get around.  Second, she needed income loss benefits for income loss caused by the accident.  At first, the insurance company relied on fine print to deny payment of "essential services."  It argued that the services were being provided by members of her household and so it didn't have to pay.  The insurance company also said that while it would pay for some income loss, it refused to consider other employer-provided benefits as income, such as her employer-provided health insurance benefits.  Fortunately, our interpretation of the insurance policy won out, and the insurance company did the right thing.

Many educated people are remarkable uninformed about their own insurance policies. People dislike the topic so much that they rarely read their policies until they need them, which is of course too late.  If you want to do yourself one favor with respect to auto insurance, take a look at your policy and make sure that you have Personal Injury Protection benefits.  It is the cheapest health insurance you will ever buy.