All motor vehicle liability policies in the State of New Jersey, including motorcycles, are obligated to provide uninsured motorist (UM) coverage and offer additional underinsured motorist (UIM) coverage as an option. UM and UIM coverage is a part of your own policy. UM provides compensation for injuries suffered at the hands of uninsured drivers. UIM coverage provides additional protection when the other driver has inadequate insurance coverage.
Since passage of the UM/UIM law, policyholders in New Jersey are permitted to choose adequate UM/UIM limits to protect themselves and their families. As a result, persons injured in motor vehicle accidents are no longer dependent on the liability coverage of the other driver and can maintain additional protection under their own insurance policies.
The UM/UIM law applies to all privately-owned motor vehicles, not just automobiles, and includes trucks and motorcycles. As a general rule, most automobile insurance companies include UM/UIM limits that match your liability limits. But the same may not always be true for motorcycle policies. In either situation, always check your policy or ask your agent to confirm the limits of all coverage's on your policy.
Because many motorcycle riders also own other motor vehicles, there may be more than one policy under which they can claim coverage. UM/UIM coverage is intended to protect you from the coverage inadequacies of the other driver's policy. Therefore, it does not matter if you are injured while in a car, as a pedestrian, on a bus, in a commercial vehicle, or on a motorcycle. As a result, the UM/UIM coverage of your automobile or truck policy protects you while you are on your motorcycle and vice versa.
Having more than one policy containing UM/UIM coverage presents interesting questions regarding who pays you in an accident, especially where the policies contain different limits of coverage. The complexities of those issues are beyond the scope of this article. However, as a general rule, multiple policies cannot be "stacked" to increase the amount of coverage available. The maximum amount of coverage available to you is determined by the highest limit available in any one policy.
Generally speaking, automobile insurance companies offer higher limits of coverage than those that cover motorcycles. Therefore, you can increase your protection while riding by purchasing higher limits on your automobile policy than offered on your motorcycle.
An area of great interest to motorcyclists is the UM provisions regarding "hit and run" vehicles. A hit and run vehicle is included in the definition of an uninsured motor vehicle. It is one where "the identity of the motor vehicle and of the operator and owner thereof cannot be ascertained or it is established that the motor vehicle was, at the time said accident occurred, in the possession of some person other than the owner without the owner's consent and that the identity of such person cannot be ascertained."
An individual involved in an accident with a hit and run vehicle may pursue an UM claim for bodily injury. However, in order to prevent fraudulent claims, property damage from such accidents is not recoverable.
It is important to note that the hit and run vehicle need not actually make contact with either the injured individual or his/her vehicle in order to collect UM benefits, nor does the existence of the hit and run vehicle have to be corroborated by independent evidence in order to make out a claim.
As motorcyclists, we are well aware of the numerous instances in which riders are forced to "dump" their bikes to avoid the negligent actions of automobile drivers who, oblivious to the damage they have caused, leave the scene. The "no contact, no corroboration" rule allows you to still pursue a UM claim. However, in these instances, you are best advised to make reasonable efforts to identify the owner and operator of the hit and run vehicle and promptly report the accident to the police as well as your insurance carrier.
UIM coverage is purchased by the insured to provide additional coverage where the other driver responsible for the accident has inadequate insurance coverage to compensate the injured individual for the full value of his damages. Again, where multiple policies exist, no "stacking" is allowed, so the maximum coverage available is the highest limit of any of the policies you have purchased on your vehicles.
UIM coverage requires the injured claimant to first proceed to collect the liability limits of the other driver responsible for the accident. The injured UIM claimant must first demonstrate that he has "exhausted" the liability policies of all other responsible parties. This would include the liability limits of insured drivers who were at fault, tavern owners, if applicable, UM claims, if applicable, and any other liability policies of any responsible parties.
If, after exhausting all other applicable liability policies, the injured party has not been fully compensated and his UIM limits exceed the amount he has collected, then a UIM claim may proceed.
UIM coverage provides protection up to the limits purchased, with a set-off for any amounts collected by exhaustion of liability policies. For example, an injured claimant with a $100,000 UIM policy sustains injuries with a value of $60,000 through the fault of a driver with a $15,000 liability policy. The claimant would collect $15,000 from the other driver's liability policy and be entitled to $45,000 of UIM benefits. The UIM carrier is always entitled to a "set-off" for amounts previously collected. The difference in coverage up to the value of the claim is the available coverage to the claimant.
Both UM and UIM claims are handled by way of arbitration. Some policies provide for arbitration through the American Arbitration Association. Most, however, provide a procedure whereby you and the carrier each pick an attorney to act as an arbitrator and the two attorneys thereafter agree upon a third attorney to act as the neutral arbitrator. This panel will then schedule a hearing.
The arbitration procedure is simpler, quicker and more cost effective than a lawsuit. Hearings can be scheduled within months after the selection of the arbitrators and pre-hearing discovery procedures between the claimant and carrier are simplified.
At the time of the hearing, the claimant and his attorney present their case in an informal fashion, submitting medical reports and other documents in support of their case. Live testimony by doctors and fact witnesses is usually not necessary. The insurance company attorney will usually present witnesses statements and reports prepared by their doctors.
After the presentation of proofs, the arbitrators will discuss the case in private, reach a determination as to liability and damages and make an award of a dollar figure for damages. Under New Jersey law, a decision by two of the three arbitrators is binding under certain circumstances that differ between UM and UIM claims.
In either UM or UIM arbitration, if there is no agreement between at least two of the three arbitrators or the amount exceeds $15,000, either party has 60 days within which to demand a trial. If neither party makes such a demand, then the damage award by the arbitrators will be binding.
Uninsured and Underinsured Motorists Coverage are key components to your automobile and motorcycle insurance package. Press your agent or broker for an explanation of what their company offers and at what price. Make sure that matching UM and UIM coverage is included.
I always advise buying as much insurance as possible. Being unexpectedly struck and seriously injured by a negligent driver is always a surprise. Finding out he has little or no insurance can be an even bigger one!
The State of New Jersey requires all motor vehicles to maintain minimum policies of $15,000. However, almost 40% of all vehicles in New Jersey are either totally uninsured or carry the minimum required. 