How Much Underinsured Coverage Do I Need?

To come back here, remember CagerProtection.com

How do you protect yourself against Cagers?  Underinsured coverage!

What’s a Cager?

A word used by motorcyclists and bicyclists to describe drivers of cars who sit in a cage (car body) and don’t pay attention or see what’s around them. Cagers don’t see motorcycles.

How much underinsured coverage do you really need when you get hit by this cager?
Hint:  This driver is about to hit you and he only has $25,000 coverage!

Driver looking at cell phone

Find out how we’ll give you money to help protect you!

What’s Underinsured Coverage?

It’s the most important coverage on your motorcycle insurance policy because it pays you!

Uninsured coverage will pay YOU money when you are injured by the negligence of someone who has no insurance or who left the scene in a hit and run.

Underinsured coverage will pay YOU an additional amount above the other car’s insurance coverage when they have less liability insurance coverage than your liability insurance limit.

Uninsured and underinsured coverage will not pay money to someone injured in the car that hit your motorcycle. This coverage only protects you and a passenger on your motorcycle.

Uninsured and underinsured coverage is sold by insurance companies in a package of the same amounts so if you have $300,000 for one, you have $300,000 for the other.

Example: You have $300,000/$500,000 liability with $300,000/$500,000 underinsured coverage. If your ankle is broken when hit by a car with a $25,000/$50,000 insurance policy, the car has $275,000 less liability insurance than your liability insurance.  Therefore, you can collect $25,000 from the car which injured you and your motorcycle insurance company will pay you up to an additional $275,000 for a total of $300,000.

Even a torn meniscus (knee injury) can be worth a lot of money because it will cause serious problems as you get older. We obtained a $465,000 verdict for a motorcyclist who had a torn meniscus. See what a knee injury and other injuries can be worth.

Funny video about underinsured coverage

How to Determine How Much Underinsured Coverage You Have Now

Most motorcyclists have only $25,000 uninsured coverage with $0 underinsured coverage!

Look for your motorcycle insurance policy DECLARATIONS PAGE.  This is the page that shows a list of your coverage limits and how much you are being charged.

You may see uninsured and underinsured coverage listed on your motorcycle insurance policy as:

  • Uninsured/Underinsured
  • Supplementary Uninsured/Underinsured
  • Supplementary UM
  • SUM

Example showing how Supplementary Uninsured/Underinsured Motorists Coverage is listed on a motorcycle insurance policy (will look similar on different policies). This example shows the motorcyclist has $50,000/$100,000 which will pay the motorcyclist up to $50,000 and up to $50,000 for a passenger and no more!
(click image to see larger)
Underinsured Coverage Shown on Motorcycle Insurance Policy

Funny 3 min video about underinsured coverage
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Benefits of Underinsured Coverage

More money — Of course, the most important benefit is that you will get a lot more money when you really need it — after you’re injured in a motorcycle accident.  You will probably not be able to work for a few months.  You will need money to pay your living expenses and medical treatment.

Speed up your case — A very important side benefit to having a high underinsured limit is that it can substantially speed up your case, getting money to you much faster, often in just months. When your injuries keep you out of work, you need money quickly, not years later. If you don’t have health insurance to pay your medical bills, you’re going to need a lot of money very quickly.

When you have underinsured coverage higher than the car’s insurance, the car’s insurance will usually pay the entire policy quickly.  This is because they know we cannot get the additional money from your insurance company, without car’s insurance paying the entire policy. They know if they don’t pay, we must go to trial with the car’s insurance company and they really don’t want that.

Once the car’s insurance company offers to pay their insurance policy, the underinsured claim against your insurance company can be decided by arbitration within months instead of a lawsuit which takes years. Additionally, an arbitration usually costs less than $1,500 while trial expenses can cost as much as $15,000-$35,000.

Do You Need Underinsured Coverage?

No one should ever have less than $100,000 but many injuries from motorcycle accidents are worth more than $500,000 to millions.  We obtained a $465,000 jury verdict for motorcyclist who struck the side of a car making a left turn and he suffered a knee Injury with a torn meniscus and arthroscopic surgery.  The loss of a leg can be worth $6 million.

We recommend a minimum of $2500,000 underinsured coverage but more is better!  There are four insurance companies listed below which sell $500,000 coverage and two which sell $300,000.  Please get quotes and you’ll see it’s not expensive.

If you want or need to protect yourself when you are injured by a cager who has little or no insurance, you need underinsured coverage. Don’t complain about getting only $16,666 (after a one third legal fee) when your ankle is broken because of a driver who has only $25,000 insurance.

Think insurance is a waste? If you waste your money on underinsured coverage because you’re never injured, it will be the best thing you ever wasted money on!

Let us prove the driver was at fault — we need you to buy underinsured coverage to protect yourself from cagers!

How to Determine How Much Underinsured Coverage You Need

Injuries in most motorcycle accidents will keep you out of work for 4-12 months.

  1. Determine how much money you need to pay your bills if you are unable to work for 4-12 months. (mortgage/rent, utilities, TV, phones, car payments, insurance, gas, food, etc.
  2. Add 50,000-$100,000 for hospital and medical bills if you don’t have health insurance. If you do, add for deductibles, co-payments plus treatment, therapy, home care and medications not covered by health insurance.
  3. Add how much more money you want for your pain and suffering if you are injured.
  4. Add 50% to the total which adds enough to pay the 1/3 legal fee.
  5. The total of 1-4 is the amount of underinsured coverage you need to purchase .

Example Showing the Amount of Underinsured Coverage You Need

  • You earn $75,000 per year with net income of $48,750 after taxes.
  • You have health insurance – add $15,000 for non-covered therapy, co-payments and other expenses.
  • You don’t want any additional money for your pain and suffering.
  • To get the $63,750 you need (after legal fees) you have to buy $100,000 coverage.
To insure yourself for the minimum amount you need:

$48,750 (lost income) + $15,000* (medical bills) + 50% (1/3 legal fee) = $95,625 (the amount you need). (Your future lost wages and future medical bills may be much more.)
Purchase at least $100,000 underinsured coverage since underinsured coverage is sold in amounts of $50,000; $100,000; $250,000 $300,000 or $500,000.

To insure yourself for the minimum amount you would like including pain & suffering:

$48,750 (lost income) + $50,000* (medical bills) + $100,000 (amount you want for your pain) + 50% (1/3 legal fee) = $298,750.
Purchase $300,000 or $500,000 underinsured coverage.

*Your medical bills could be much higher.  While usually between $35,000 to $100,000 in motorcycle accidents, we have seen medical bills as high as $1 million.

Free Uninsured/underinsured calculator — find out how much you need

underinsured coverage calculator The Underinsured Motorist Coverage calculator is an easy to fill out excel spreadsheet you download.  In just a couple minutes, the calculator will tell you the minimum amount you need on your motorcycle insurance policy.  If you don’t have excel, get Libre Office for free!

The only insurance coverage calculator I found on the Internet is from The Hartford but it looks at how much liability you need, not how much underinsured coverage you need.  With motorcycle insurance policies, underinsured coverage is far more important than liability, but you have to increase your liability to increase underinsured coverage because you can’t buy a higher underinsured coverage amount than your liability amount.

How Much Underinsured Coverage Can I Buy?

Underinsured Coverage is an optional coverage. The minimum required by New York State is $25,000 uninsured coverage which insures you when you are injured by someone without insurance. If you have $25,000 liability coverage, you have $25,000 uninsured coverage and you do not have any underinsured coverage.

NYS law requires a minimum of $25,000 uninsured coverage with $0 underinsured coverage.

The amounts of underinsured coverage which can be purchased to protect a motorcyclist, depending upon the insurance company, is:

  • $0 – None (if you don’t purchase any)
  • $50,000 (totally inadequate for all motorcyclists)
  • $100,000 (inadequate for all motorcyclists)
  • $250,000 (the minimum amount you should consider purchasing)
  • $300,000
  • $500,000
  • more than $500,000

What are split limits and why they are not important to motorcyclists?

Split limits look like $100,000/$300,000. This means your insurance company will pay no more than $100,000 to each person who is injured and no more than $300,000 for everyone injured in the accident.

Don’t forget that underinsured coverage pays money for you and your passengers. This money is not paid to someone injured in the car that hit you.

Since you won’t have more than two people on your motorcycle, if you have $100,000/$300,000 underinsured coverage your insurance company will not be able to pay more than $200,000 in underinsured coverage payments, even though you have $300,000 total coverage. The motorcyclist can be paid $100,000 and the passenger can be paid $100,000.

If you ride alone, and you have $100,000/$300,000 underinsured coverage your insurance company will not pay you more than $100,000. If you ride alone, always look at the first figure if you have a split limit insurance policy.

If you have a single limit insurance policy, with $300,000 single limit underinsured coverage, the insurance company can pay you up to $300,000 for your injury and will not pay more than $300,000 for both you and your passenger.

Which Insurance Companies Sell the Most Underinsured Coverage?

Uninsured and underinsured coverage is sold either as a single limit (ex. $300,000 total for both motorcycle operator and passenger) or a split limit (ex. $100,000/$300,000). The lower number in the split limit is the maximum amount per person. If you don’t have a passenger riding on the back of your motorcycle, the amount you’re interested in is the lower amount.

I called 11 insurance companies which sell motorcycle insurance in New York and asked how much underinsured coverage I can buy in NY (Note: you must purchase liability coverage in the same or higher amount as your underinsured coverage. Make sure your underinsured coverage is as high as your liability coverage).

The coverage limits below show the one that insures a motorcyclist without a passenger (if you have $100,000/$300,000, you really only have $100,000 and your passenger has $100,00. The last $100,000 is not available to anyone).

List of insurance companies with the maximum amount of underinsured insurance coverage they sell in New York to cover YOU the motorcycle operator are as follows:

      • Chubb – as much as you want
      • Liberty Mutual – $500,000
      • Foremost – $500,000 (sells for Farmers agents & 21st Century)
      • Nationwide – $500,000
      • Progressive – $300,000
      • GEICO – $300,000
      • Allstate – $250,000
      • State Farm – $250,000
      • Esurance – $250,000
      • Dairyland – $250,000
      • Farmers – $250,000
      • MetLife – $250,000
      • Markel – $250,000
      • Amica currently sells through Progressive but will soon sell directly in NY
      • The Hartford does not sell motorcycle insurance in New York
      • Travelers does not sell motorcycle insurance in New York
      • Kemper does not sell motorcycle insurance

Our recommendation is to purchase $500,000 but no less than $250,000.  Specialized Insurance & Rossi Insurance sells motorcycle insurance and understands the importance of underinsured coverage for motorcyclists.

Review your coverage every time you renew your policy every spring or when you put your motorcycle back on the road because we have seen insurance companies reduce coverage back to the minimum after putting a motorcycle back on the road.

How Much Does Underinsured Coverage Cost?

If you already have higher liability insurance limits, increasing your underinsured coverage will cost less. If you have minimum liability insurance limits, you will have to increase your liability limits so you can purchase underinsured coverage. However, increasing your liability limit on a motorcycle policy is not expensive and well worth the small cost to protect yourself with substantial underinsured coverage.

High underinsured coverage on a motorcycle can cost a few hundred dollars per year, but approximately 1/2 of our cases involve an injury worth $500,000 or more. For instance, we got a verdict of $465,000 for a knee injury with a torn meniscus.

You may be able to get a discount on your motorcycle insurance by taking a motorcycle school class and we’ll pay you to take the class!

Too much info here?  If you have any questions about your insurance coverage, please feel free to call Phil Franckel 7 days/nights to discuss it for free (we don’t sell insurance but we’ll give you free advice).

1-800-HURT-911
1-800-487-8911

If you’re involved in a motorcycle accident, even if another lawyer doesn’t think you have a case, call us immediately for a free consultation.  We care about motorcyclists!