In November of 2015, the Oregon Legislature passed a bill that sought to improve insurance benefits for victims who are injured in motor-vehicle collisions. Senate Bill 411 (SB 411), was signed into law by Governor Kate Brown. The bill expands coverage for two key areas of car insurance policies: personal injury protection (PIP) and under or uninsured motorist coverage (UIM).
Effective as of January 1, 2016, the new law provides injured parties greater access to compensation. Changes made by the law go into effect on policies renewed or created on January 1, 2016 or later. Drivers who renewed their policies before the specified date cannot benefit from the changes the law presents until it is time to renew again.
Personal Injury Protection
Oregon is one of the 15 states in the US that requires drivers to carry some form of personal injury protection, or PIP insurance coverage. The minimum coverage for PIP is $15,000. This means that in the event that you are injured your insurance company covers reasonable and necessary medical expenses worth up to $15,000 regardless of who was at fault. This coverage extends to cyclists and pedestrians who are hit by a motor vehicle.
Two Major Changes
Before SB 411, PIP insurance paid medical expenses incurred from an auto accident for up to a year after the collision occurred. Now that SB 411 has been enacted, the payment period increased to 2 years. Since $15,000 is nowhere near the average amount needed to recover from serious personal injury, and since the payment period grew a full year, it is possible to purchase additional coverage.
Another boon to injured parties that arose from SB 411 is the manner in which at-fault carriers must reimburse the PIP carrier. It used to be that the at-fault party’s insurance must reimburse the injured party’s insurance in full unless the injured party’s economic damages exceeded the amount recoverable. The injured party’s insurance company could still receive compensation even if not enough of it was available to fully cover the injured party.
Under the new law, the at-fault party’s insurance must pay the injured party after the injured party recovers all damages from his own policy. This leads to greater compensation for the injured party, as he or she can receive damages from both insurance providers. If your medical expenses exceed your insurance coverage, you can receive compensation from the at-fault party’s insurance before getting your medical insurance involved, or paying out of pocket.
Under or Uninsured Motorist Insurance
$25,000 per person and $50,000 per crash for bodily injury are the minimum coverage requirements for under or uninsured motorist (UIM) protection in Oregon. As previously mentioned, the minimum insurance requirements typically do not provide enough compensation for serious injuries. In fact, the average serious injury accident incurs costs of $126,000 according to the American Auto Association (AAA), much greater than the minimum requirements.
If you are struck by a driver with no car insurance and you face serious injuries, $25,000 isn’t going to get you very far. If you sustain an average injury accident worth $126,000, you’re left with $101,000 in expenses to pay out of pocket. This is why many insurance companies recommend having 5-10 times the amount of coverage that is required.
The reality is, over a third of Oregon drivers are getting by with the lowest possible insurance coverage that is legally allowed, or no insurance at all. If you are struck by a driver who carries no insurance or not enough coverage, you have to pay for a lot of your expenses yourself; that is, until SB 411 was activated.
The following is an example of how your insurance coverage used to work:
- Driver A is injured in an automobile accident that was the fault of Driver B, who has the minimum liability coverage of $25,000. Driver A also has minimum UIM coverage of $25,000. Driver A’s insurance company pays nothing as both of these policies “cancel each other out.” If Driver A’s insurance coverage was worth $100,000, his insurance company would only pay $75,000, or the difference between his policy’s coverage and Driver B’s.
Now, thanks to SB 411, insurance companies are required to “stack” liability and UIM coverage to provide the maximum coverage possible for the injured party. In this situation, of two parties who each have the minimum $25,000, the injured party would be entitled to $50,000 by receiving damages from the at-fault driver’s policy and by filing a claim against his own policy.
Although critics of the law claim insurance rates will go through the roof, this is a huge advantage for injured persons. To take full advantage of the new law, contact your insurance provider and request your policy be renewed if it has not been since before January 1, 2016. If you have been seriously injured in an automobile accident, you deserve to make the most out of your insurance coverage. At Rizk Law, our attorneys specialize in auto insurance claims negotiations. Contact Rizk Law today for a free legal consultation.