Three Reasons Why Ohioans Should Not Let Their Auto Insurance Lapse in The Covid-19 Era

Jun 05, 2020

Recent trends show that car insurance policies, as a result of COVID-19 and economic downturn, are lapsing for many drivers. Similar statistics also show that some drivers are reducing their insurance coverages to save financial resources. However, we believe it is important that drivers do their very best to keep their auto insurance coverage in place for several reasons:

1. Medical payments coverage can be beneficial during uncertain times

As a result of COVID-19, many employees have lost their jobs, as well as their health insurance benefits. While car accidents can be burdensome in regular circumstances, the hardships caused by a car accident can be even more severe when a driver does not have health insurance to cover the medical expenses required for necessary treatment. However, medical payments coverage can ease those burdens.

Medical payments coverage, also known as “med pay”, covers expenses for medical treatment of injuries that were sustained in a car accident. A typical amount of med pay coverage is $5,000.00, but the limit of these type of coverage can be lower or higher than that amount depending upon the terms of the policy. Having medical payment coverage can be beneficial for those without health insurance because it allows drivers to avoid paying out-of-pocket for those expenses.

Med pay coverage also is a no-fault coverage, meaning that it applies regardless of who was at-fault for causing the incident. Therefore, in situations where liability may be tough to prove, or where the driver may be at-fault, drivers can still benefit from medical payment coverage.

2. Underinsured/ Uninsured Motorist Coverage is more important now than ever

When car accidents result in serious injuries, it creates a real need for funds to pay for future treatment, out-of-pocket expenses, and other expenses, such as therapy and home care. If someone else is at fault for an automobile accident in which you are hurt, you would typically submit a claim to that person’s automobile liability insurance carrier. But, what if that person has a low amount of liability insurance which is insufficient to cover your damages? Or, worse yet, has no cover at all? You could be responsible for your own bills which you incurred because of someone else’s fault. Unfortunately, the possibility of a situation like this is more likely given current conditions and financial hardship.

For these reasons, drivers should also maintain adequate underinsured motorists’ coverage (“UIM”) and uninsured motorists’ coverage (“UM”) beyond medical payments coverage. One’s own UM/UIM coverage will pay for bills and otherwise compensate your damages in the absence of adequate liability coverage for the at-fault driver.

In Ohio, an “underinsured vehicle” is defined in several ways. A vehicle is underinsured if the at-fault vehicle has less insurance coverage than the vehicle that was not at-fault (e.g. The at-fault driver has $25,000.00 and the other vehicle has $100,000.00 in UIM coverage). In situations where the at-fault driver’s insurance coverage is the same as the other vehicle’s coverage, the at-fault vehicle is not “underinsured”, and the driver of the other vehicle will not be able to access underinsured motorists’ coverage.

With statistics showing that drivers are either lowering their coverages or are letting their coverage lapse, the chances of having adequate insurance coverage to recover from for serious injuries is seemingly lower. Therefore, drivers should maintain quality UIM and UM coverage in order to protect one’s self and ensure that proper funds are available in the future if needed.

3. You still may be able to maintain your coverage and make payments later

Should you be in a position where you cannot afford to continue paying for your auto insurance coverages, you should be aware that some states have taken measures to help you maintain your coverage. In Ohio, for example, insurance companies are required to provide a grace period of at least 60 days to customers who have been financially affected due to COVID-19. This includes payments for auto, home, life, and long-term insurance. For more details, click here to read the Ohio issued notice. Also, some insurance companies are offering additional relief to their insureds, such as paying portions of their premiums back or offering discounted premiums. Therefore, be aware that other options may exist before making the decision to reduce your coverage and letting your coverage lapse.

For legal guidance, or to speak with a trusted and experienced Ohio personal injury attorney, please call the law firm of Brian G. Miller Co., L.P.A. at (614) 221-4035 to schedule a free, no-obligation consultation.