Car Wreck Insurance: Frequently Asked Questions

Top Questions in regard to a Car Wreck Accident

What kind of insurance do I need before the car wreck happens?

An automobile insurance policy is a legal contract; a contract between you and your insurance company in case of a car accident. The terms of that insurance contract act like a photograph when a car accident occurs;you can’t add anything to that photograph once the accident occurs and the insurance company can’t take anything out of that photograph. So, if you purchase car insurance immediately after the car accident, you will not be covered.

The best car insurance to have has nothing to do with the insurance company who is selling it

A good car insurance policy should have at least 100,000 per person of uninsured and underinsured motorist coverage. I don’t care which insurance company you use as long as you have these kind of insurance coverages. These coverages protect you when you are not at fault for the car accident and the at-fault driver has no insurance or not enough insurance. Bodily Injury coverage protects you when you are at fault for the car wreck and the other driver is suing you, or making an injury claim against you.

How do I read a car insurance policy?

Automobile insurance policies will have what is known as a declarations page. The declarations page is a brief summary of your insurance coverage, and it will usually contain terms like “bodily injury” or “uninsured motorist coverage” followed by numbers such as 25,000/50,000 or 100,000/300,000.

The first number, 25,000 for example, represents the maximum that insurance company will pay out to any single person under that coverage. The second number is the maximum that insurance company will pay out to everyone injured in the car wreck no matter how many people might have been injured.

What kind of car insurance protects my family?

All insurance policies will have what is known as “bodily injury coverage” or “liability coverage”. This coverage applies when you were at fault for the car wreck. In essence, it means that your insurance company will defend you from the claims presented by the injured person(s) in the car wreck.

For car accidents that were not your fault, your automobile insurance policy should have the following insurance coverage to make sure you and your family are protected: 1) no-fault coverage; 2) uninsured motorist coverage and; 3) underinsured motorist coverage.

Don’t assume that these coverages will automatically be on your car insurance policy. You will want to specifically request them and confirm that they are on your car insurance BEFORE the car accident happens.

What is Kentucky No-Fault Insurance?

Think of it like health insurance, for the first $10,000 of your medical bills, through your car insurance. In Kentucky, the no-fault coverage is automatic. If the car wreck happens in Kentucky, you are entitled to no-fault coverage even if your car is not registered in Kentucky. Essentially, if a car wreck happens in Kentucky, there will be a no-fault carrier responsible for the first $10,000 of your medical bills, unless your stole the car or did not pay your insurance premiums.

So yes, even if you are at fault for the car accident, you can make a claim against your no-fault insurance for your medical bills up to $10,000.

Reserving PIP or No-Fault Insurance is the most important thing you can do after a car accident in Kentucky.

The car wreck happened, you went to the Emergency Room and now the day after, you are talking to your insurance company about the damage to your car. TELL THEM TO RESERVE YOUR NO-FAULT BENEFITS IMMEDIATELY. This is the best legal advice I can give you for any car wreck happening in Kentucky no matter whether you want to make get additional treatment or not.

To oversimplify, no-fault insurance, it can cover your medical bills, lost wages, prescription reimbursements, co-pays from your health insurance and replacement lost services that you incur from a car accident happening in Kentucky. Know that no-fault is supposed to be primary over your health insurance but more importantly, it pays medical providers the full amount of their bill. In contrast, I pulled from Chatgpt.com the following in regard to emergency room bills:

• Commercial insurance plans often negotiate discounts between 30% and 70% off the billed charges.
• Medicare typically reimburses at a much lower rate, often around 20-30% of billed charges.
• Medicaid reimbursement rates are similar to or even lower than Medicare, often around 10-30% of billed charges.

Realize the job of a good car wreck lawyer is to stretch a dollar bill so that it can pay as much of your medical bills as possible.

If an emergency room bill is high (e.g. $15,000), it would eat up all the $10,000 in no-fault coverage and the remaining $5,000 would have to be billed to the client’s health insurance. But there would be no PIP left to pay for physical therapy or chiropractic treatment and many health insurance plans limit the number of chiropractic or physical therapy sessions they will pay for.

So, RESERVE the no-fault, use that reserved no-fault insurance to pay for the medical treatment, except for the large emergency room bill. The emergency room bill, once the treatment is done or the no-fault is exhausted, will be paid by the health insurance and the health insurance will pay it at a reduced rate, as discussed above.

When the injury claim is settled, the health insurancewill have a subrogation claim against the personal injury claim for any amounts they pay out on her behalf. However, the subrogation lien for the health insurance carrier is for the amounts they paid the medical providers, not the amount billed by the medical providers. Consequently, as an injury attorney, I have used my client’s no-fault insurance to stretch a dollar bill and pay a greater amount of their medical bills, with a lesser amount of money.

Why do I have to use my car insurance, for a Kentucky car accident, when I was not at fault for the car wreck?

If you are making a personal injury claim, you need at least $1,000 in medical bills to pursue a claim for pain and suffering. You don’t have a choice but to use your car insurance which is the PIP or no-fault carrier.

Basically, PIP coverage, and to very much oversimplify it, means you have $10,000 of health insurance coverage through your car insurance, no matter who caused the car wreck.

In exchange for that legal right, you gave up the right to recover the first $10,000 in medical bill from the at-fault party and that legal right was transferred to the PIP carrier; since they are responsible for your medical bills. So, if your health insurance pays the medical bills instead of your automobile insurance, they have a subrogation claim against the personal injury claim. This means they have the right to recover what they paid from your personal injury settlement. Essentially, to not use your no-fault insurance, would mean you are not recovering your medical bills from the at fault party and are paying them out of your personal injury settlement.

To explain it another way, here’s a brief video explaining the health insurance lien, covered above.

What is Uninsured and Underinsured Motorist Insurance?

Uninsured motorist coverage provides you with the means of presenting your personal injury claim, against your own insurance company, when the at-fault driver was operating his vehicle without insurance in violation of the Kentucky traffic laws. Underinsured motorist coverage provides an extra layer of insurance coverage. Essentially, when the at-fault driver does not have enough insurance coverage to satisfy the full value of your personal injury claim, underinsured motorist coverage allows us to make a claim against your own insurance coverage for additional funds, even though we have recovered all of the insurance coverage on the at-fault driver.