A new law stops insurance companies from denying injured drivers from collecting underinsured motorist benefits that the law requires car insurance coverage to include – but it only applies to policies activated or reissued Jan. 1 and afterward.
Before, if a driver with $25,000 in liability insurance wrecked your car and injured you, and you had a $25,000 policy for underinsured drivers, your own insurance company would have denied your claim for underinsured motorist benefits – even though you had been paying premiums all along for underinsured motorist coverage, and even if your medical bills were much higher.
The new law, SB411, prevents insurance companies from subtracting the amount of liability insurance another driver has from the amount of underinsured coverage stated in your own insurance policy.
SB411 makes sure that underinsured motorist coverage you paid for benefits you, instead of lining the pockets of insurance companies.
The change in the law only applies to policies first obtained or reissued after Jan. 1, 2016. Be sure to get your existing policy reissued in order to take advantage of this new law.