Cheap vehicle insurance, The Coverage Conundrum
When Robinson got in her accident, she immediately filed a claim with the responsible party’s insurance company, State Farm. Robinson originally asked for $40,000, but State Farm ended up offering $20,000, both of which are sums well within the $100,000 worth of coverage that the policy provided. But negotiations between Robinson and State Farm broke down, and after three years there still was no settlement. Robinson later found out after surgery, however, that her condition was more serious than had been expected. After it came to light that she may have pain from the accident for the rest of her life, State Farm offered her the full $100,000 provided in the policy.
Following that, Robinson filed a claim under the UIM portion of her policy to get expenses above the $100,000 limit covered. But because the claim was filed well past the window outlined in the policy, her insurer denied it. So is UIM coverage worthless when it comes to latent conditions like Robinson’s? Not so, said the court.
According to the court, Robinson should have filed a UIM claim with her own insurer at the same time she filed a claim with the responsible party’s insurer, despite the fact that she didn’t know that her medical expenses would exceed the other driver’s policy limits. According to the opinion published by the court, this is a common practice in Iowa. The justices basically said that an insurer would likely put the claim on hold until the initial claim with the responsible party’s insurer was resolved.
So when it comes down to it, you don’t have to predict what all your future medical expenses may be in order to file a UIM claim. You can simply preemptively file one early on to avoid having to pay out of pocket for expenses that could get out of control.