As discussed previously, Virginia law mandates that all family automobile insurance policies which provide liability coverage when operating the insured vehicle must provide Uninsured Motorist coverage (UM coverage) with limits equal to the amount of liability coverage unless the insured waives in writing the requirement and requests a lesser amount of coverage.
In addition to providing coverage where a party is injured by the negligence of a driver who is uninsured or unknown, the UM endorsement provides one of the most important and most complex coverages for injured parties and that is “underinsured motorist” coverage.
Starting with a simple example, suppose you are operating your vehicle and under the policy that insures your vehicle through State Farm, you have a UM limit of $300,000.00. Suppose further that another driver is negligent and causes a collision which causes you injury, and that driver has a policy with Allstate which has a liability limit of $100,000.00. Under this scenario there is $200,000.00 of “underinsured motorist” coverage applicable to your claim. If you obtain a judgment of $300,000.00, Allstate would pay you $100,000.00 and State Farm would pay you $200,000 in satisfaction of your judgment.
This is a simplification of a simple scenario because there can be other issues that relate to things like interest on the recovery. Case law in Virginia reveal more complex scenarios and rules that your Virginia auto accident lawyer needs to understand to properly handle your case. Some of these will be discussed later.