You are driving home from work at 7 p.m. on a nice clear fall evening, excited to get home to see your spouse and children before they go to sleep. You are only two minutes away from your house, and you stop at the red traffic light that you always seem to miss just before arriving home.
After a long day at the office, having a home cooked meal with your family is the perfect remedy. Unfortunately, the person operating his car behind you went out drinking after work, had too many drinks, and crashes at full speed into the back of your vehicle. You sustain neck and low back injuries that eventually require surgery, and your entire life is turned upside down. At least the person that rear-ended you had car insurance, so you should be fairly compensated for your injuries, right? Not necessarily.
Pennsylvania remains behind the majority of states regarding bodily injury and uninsured/underinsured motorist insurance minimums. Despite efforts for several years to raise these minimum insurance limits (which have been in place since 1974), the minimum bodily injury liability limits are $15,000 per person/$30,000 per accident. Most states have at least $25,000 per person/$50,000 per accident of bodily injury insurance minimums, including New York, New Hampshire, Rhode Island, Virginia, and Ohio. In 2011, Maryland passed a law raising their minimum bodily injury liability requirements to $30,000 per person/$60,000 per accident. In April of 2017, I testified in Delaware in front of the full Senate and committee in the House of Representatives (testimony in front of the full House of Representatives was not necessary) regarding House Bill 114, which sought to increase the bodily injury limits from $15,000 per person/$30,000 per accident to $25,000 per person/$50,000 per accident. The bill passed the House of Representatives and the Senate, and was signed by Gov. John Carney on July 13. This new law allows 6 months for insurance companies to change their policies, and by Dec. 13, all motor vehicle insurance policies written in Delaware will have minimum bodily injury policy limits of $25,000 per person/$50,000 per accident. Consequently, because Delaware requires that uninsured/underinsured motorist policy limits be offered at the minimum level of the bodily injury policy limits, all uninsured/underinsured motorist policy limit minimums will also start at $25,000 per person/$50,000 per accident as of Dec. 13.
Honestly, even $25,000 per person/$50,000 per accident of bodily injury and uninsured/underinsured motorist coverage will not adequately protect you or anyone in your car if catastrophic injuries are sustained in an accident. But the goal is to increase insurance minimums as high as possible while still maintaining the balance in premium increases to make car insurance as affordable as possible. The majority of states (33 at this time) have minimum bodily injury requirements of at least $25,000 per person/$50,000 per accident. Any state with less coverage has simply not caught up with inflation, the increasing costs of medical expenses, and the standard of living. Moreover, raising minimum insurance requirements will benefit the state, the federal government, private health insurance, medical providers, and the victims injured in motor vehicle accidents. Higher insurance policies result in more money available, which in turn provide a larger pot of money to pay all interested parties affected by the loss.
For example, state Medicaid, Medicare or private health insurance usually cover medical bills for treatment incurred by the injured party once personal injury protection benefits (only a $5,000 minimum in Pennsylvania) have been exhausted. These health providers may have a lien that they attempt to recover out of the third party case, but if insurance money is limited, there may be nothing for them to recover. With more money available following a loss, the lienholders will have more to recover. States are struggling each year to balance their budgets, and if money can be reimbursed to Medicaid, this will help States when it comes down to crunch time. Similarly, medical providers with outstanding balances will also have more money to collect for treatment rendered to the car accident victims.
Most importantly, having a larger sum of money available will help fairly compensate injured victims. To be clear, innocent victims of car accidents will not receive a windfall simply because of more insurance available. Rather, people will get closer to what they deserve to fairly compensate their injuries.
Opponents (the insurance industry) will argue (as they did in Delaware) that raising premiums will mean less people purchasing car insurance and more uninsured drivers. However, Maryland raised their insurance minimums in 2011 and has not seen a noticeable increase in uninsured drivers. In Delaware, the increase in premiums will be minimal, and the amount of increased coverage is significant. In Pennsylvania, with a population of 12.8 million people and multiple major high-speed roadways stretching across the state, the risk for more significant accidents and injury is even higher. There is no reason for insurance minimums to be consistent with the economic state of the 1970s and 1980s. New Jersey continues to have low minimum bodily injury limits as well, but they are in the minority. Pennsylvania must fight to increase insurance minimums to be on par with the rest of the country.
Lawrence Spiller Kimmel is managing partner of Kimmel Carter in Delaware. He focuses his practice on personal injury and workers’ compensation law. Contact him at email@example.com.