But before you make that call, you have to understand the problem and a few things about New York auto insurance.
Here’s the problem: The minimal auto liability insurance allowable in New York pays out a maximum of only $25,000 per injured person and $50,000 collectively for all persons injured through the negligence of the vehicle’s driver. That’s woefully inadequate if you are struck by an at-fault driver and you or your passengers suffer long-term disabling injuries that prevent you or them from working.
And this ridiculously low limit applies against you and your innocent passengers no matter how much liability insurance you have purchased on your own vehicle. For example, let’s say you have $500,000 in auto liability coverage. This liability insurance you purchased will payout big time to people you might negligently injure with your vehicle, but will not pay you or your passengers a dime for injuries you or they suffer from the negligent driving of others.
Now here’s the solution: There is a little known, cheap way to protect yourself and your passengers (usually family members) from this situation: Purchase maximum SUM coverage for your vehicle. Maximum SUM brings your SUM coverage up to the same level as your liability insurance. SUM stands for “Supplemental Underinsured Motorist”.
It works like this: Say you have $500,000 of liability insurance on your vehicle. Purchase the same amount in SUM coverage. If you do, and the negligent driver who injures you or your passengers has only $50,000 in coverage, then your SUM insurance will kick in the additional $450,000 to make the total amount of insurance available to you and your passengers $500,000.
But can you afford that? Actually, you can’t afford NOT to purchase it! Buying SUM is cheap! Only a few extra dollars per premium period. And the protection it provides is enormous.
So why doesn’t everyone have maximum SUM? Good question. The insurance companies don’t make much money selling it, so they don’t push it. Right now the insurance industry generally has a “don’t ask, don’t sell” policy, meaning that if the customer does not specifically request SUM coverage, none is provided.
This insurance practice leaves many car-accident victims teetering on bankruptcy after an accident. That’s why the New York State Senate recently passed a bill (Bill S5644A) to correct the injustice. The proposed law would require insurance carriers in New York to automatically provide maximum SUM coverage on all auto policies issued in New York unless the customer affirmatively states he does not want it. If our lawmakers want to force the insurance industry to automatically provide this coverage, there is a good reason: It’s cheap and provides great financial protection for all New Yorkers.
The New York State Assembly is likely to pass the same Bill this fall and the Governor is inclined to sign it into law. But until then, you have to affirmatively ask for SUM coverage. Call your insurance broker now and request maximum SUM coverage.