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How Long Do I Have To File An Underinsured Motorist Claim With My Insurance Company?

In our article entitled “What is Underinsured Motorist (UIM) Coverage?” we explained what underinsured motorist (UIM) coverage is, and how it is different than uninsured motorist (UM) coverage. In this article, we discuss exactly how long you have to file an underinsured motorist claim with your insurance company from the time of the collision, and explain the recent  legal cases  that can help you recover from your insurance carrier.

First, it is helpful to understand exactly what UIM coverage is, and how it is different than UM coverage. If you haven’t read our articles on these subjects, here is a quick explanation of UIM coverage.

Whereas the uninsured motorist coverage portion of your auto insurance policy is used when the driver who caused the accident did not have insurance (or fled the scene of the accident before they could be identified), underinsured motorist coverage is used when the driver that caused the collision does have insurance, but the amount of coverage available under their auto liability policy is less than the amount of the losses that you have suffered as a result of the collision. In that case, you will want to make a claim with your insurance company to cover the difference between the total of your damages and the amount the at-fault party’s insurance will pay.

For example: If you are involved in a collision, and the driver that hit you has an auto liability policy that pays up to $25,000 per person, and your damages are $100,000, you would collect the $25,000 from the at-fault driver and collect the remaining balance from the UIM coverage under your policy. However,  your UIM coverage amount must be over the $25,000 paid by the at fault driver’s insurance.

So the question presented here is “how long do I have to file a UIM claim against my insurance carrier from the time of the collision?”

Traditionally, the statute of limitations (the amount of time you have to file a lawsuit) in California stemming from a car accident is two (2) years. However, some auto insurance policies allow for more time to make a UIM claim with your carrier, often it is three (3) years. You must look to the actual policy contract with your insurance company in order to determine what this time is.

Recently, however, the Indiana Supreme Court made a decision that is very favorable to those looking to file a UIM claim after the period stated in the contract has expired. In State Farm Mut. Ins. Co. v. Jakubowicz, the plaintiff was injured in a car accident by a negligent driver. The plaintiffs, the Jakubowiczs, made a motion with the court to join their insurance company, State Farm, as a defendant, based on State Farm’s refusal to pay out on the UIM claim. Defendant State Farm asserted that the 3 year period from the time of the accident had expired, and, according to their contract, they were not required to pay the difference between the Jakubowicz’ injuries and the amount covered by the negligent driver’s insurance policy.

The Supreme Court disagreed with State Farm’s position. State Farm’s contract stated that they were only required to pay out on the UIM coverage once the defendant’s (the negligent driver’s) insurance coverage was exhausted, and therefore  this court held that the 3 year time limit was in direct conflict with this provision. Essentially, since it can (and in this case, did) take longer than the 3 year time limit in order to find out what the defendant’s insurance would pay, and to have that amount paid in full, the 3 year time limit was unfair. Accordingly, the  Indiana Supreme Court held that such limiting provisions are invalid.

So, to answer the question that is the topic of this blog, the amount of time you will have to file a UIM claim against your insurance company will still depend on the language of your contract- but, such time will not begin to run from the time the accident occurs. Rather, the time will begin to run from the time that the defendant’s insurance is paid in full.

Please keep in mind that it is important to look at the exact language in the provisions of your policy contract with your insurance carrier. And as always, it is important to have an experienced attorney on your side to help interpret the terms of your insurance agreement, and to fight for your interests.

For over 30 years, the Law Offices of Vann H. Slatter have helped injured drivers in Los Angeles County and the surrounding areas get the compensation they deserve. If you or someone you know has been injured as the result of another’s actions, please call us today for your free consultation at (310) 444-3010 or toll-free at  (888) 293-0404.