Risk & Business Magazine General Insurance Services - Fall 2020 | Page 8

UNDERINSURED
Avoiding The Mistake Of Being
UNDERINSURED
A
key aspect of insurance, and
perhaps one that many people
are not familiar with until
it is too late, is the fact that
it is entirely possible to be
underinsured or insured for the wrong
things. Many people mistakenly believe,
both in the personal and the business
world, that being required to carry a certain
insurance (or a certain amount of insurance)
by law means that carrying that exact
insurance will keep them safe if they need
to use it. Unfortunately, that simply isn’t the
case.
Most states, for instance, will require car
owners to have coverage on their vehicles
in order to register them and use them on
the road (or pay an uninsured motorist fee).
The required amount, however, is usually
for liability purposes only and will not cover
you in the event that you are found to have
caused the accident. Worse, in the case of
bad accidents (especially with medical issues
involved), it will likely not be enough to
cover the damages at all no matter who is at
fault.
Nick Otis, with Newby Lewis Kaminski &
Jones, LLP, has seen this issue firsthand
during personal injury cases he has handled.
In his own words: “As a bit of background, I
will often ask clients how much insurance
coverage they have, and their response is full
coverage. That doesn’t tell me how much
coverage they have. For example, Indiana
requires a minimum of $25,000 in insurance
coverage per accident. However, if you are in
a bad accident, $25,000 will not be enough
coverage. Often what I see happen is an
individual who causes a crash doesn’t have
coverage or only has the minimum $25,000
of coverage. That’s why it’s important to
have uninsured or underinsured motorist
coverage to protect yourself if you’re hit by
someone with no coverage or low coverage.”
Coverage usually comes in set amounts,
in ranges between $25,000 and $250,000.
There is a broad range in there to work from.
Choosing the minimum is often not the
best option, especially when considering the
price differences. Additionally, companies
often offer umbrella coverages, which
will provide an additional $1,000,000 in
overage for vehicles and the home. Nick
recommends, especially for anyone with
young children or a family, to carry at
least $250,000 in coverage and taking the
umbrella option as well. In this way, if you
are ever severely injured or killed, it will be
a huge source of financial support for your
family.
That brings the key question into light: Do
you have enough insurance? If not, you may
be in for a rude awakening when it comes
time to use it. That may mean that you
don’t get your own car fixed or it may end
up being a question of how much money
you are suddenly out of pocket to pay for
someone else’s claim. +
Nick Otis has extensive experience in representing clients for claims of personal injury, property damage, and
wrongful death in both state and federal courts. Nick also has experience representing employers and employees
in employment matters in state and federal courts, and employers in labor negotiations. A former deputy public
defender for La Porte County, Nick now serves as a federal public defender under the Criminal Justice Act for
the Northern District of Indiana. He is also experienced in appellate work and has argued before the United
States Court of Appeals for the Seventh Circuit, the Indiana Court of Appeals, and the Indiana Supreme Court.
In addition, Nick represents various school corporations and serves as the City Attorney for the City of La Porte.
BY: NICHOLAS T. OTIS, PARTNER,
NEWBY LEWIS KAMINSKI & JONES, LLP
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