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What happens when insurance doesn't cover your car crash losses?

You pay for New York motor vehicle insurance, and you do so with the expectation that if you get into an accident, you won't have to worry about the financial issues that result. You depend on your insurance to cover the damage to your vehicle, as well as any accident-related medical expenses that your health insurance won't cover, especially if you have a high deductible plan.

Under New York law, everyone who operates a vehicle on public roads should carry a liability insurance policy. Failing to have insurance can result in fines, tickets and even revocation of the registration of the vehicle in question. Unfortunately, it's important to know that even if you have an active insurance policy, it won't always cover your losses after a motor vehicle crash.

Minimum insurance coverage won't cover much

Far too many people in the road try to get by with only the minimum amount of liability insurance required under the law. New York only requires that a driver carry $10,000 in property damage coverage. Repairs to or replacements of vehicles, even older vehicles, can easily exceed the maximum coverage cap. The same is true for minimum medical and wrongful death coverage.

A driver only needs to carry $25,000 worth of bodily injury coverage and $50,000 worth of crash-related fatality coverage for a single person in a crash. The policy will double, to $50,000 for injuries and $100,000 for death, if two or more people got hurt. It's easy to see how serious injuries could quickly exceed the maximum payout for minimum coverage. Especially in a city where people make huge salaries, the wrongful death coverage may also end up being far lower than what is needed by survivors.

Not all settlement offers are in your best interest

Sometimes, even in a case with a good insurance policy, the outcome can be financially devastating for the injured party. Insurance companies are notorious for offering low ball first settlement offers. You may think that receiving an up front payout is better than constantly submitting bills and expenses for coverage. However, the amount may end up being far lower than what you'll actually need to cover all of your ongoing costs.

You have options after a serious car accident, and you should definitely consider them carefully before committing to a settlement or resigning yourself to paying out of pocket. When costs exceed the available coverage or a settlement offer, you need to stand up for yourself. Countering a low settlement offer can result in a better offer at a later time. You may also need to consider bringing a personal injury or wrongful death claim against the driver who caused the accident.

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