Many purchase uninsured motorist coverage on their auto policy. This is a prudent practice given the number of uninsured drivers on the road. Uninsured motorist coverage provides benefits in the amount they injured person would have been able to recover from the uninsured driver. Medical bills, wage loss, pain and suffering and loss of the quality of life are recoverable. The public policy behind the law is to allow consumers to be compensated for everything they had a right to recover against the guilty driver who didn’t carry insurance. The one thing missing from the coverage are the costs associated with the damage to the car. In order to recover these, consumers must purchase a separate coverage usually referred to as uninsured motorist property damage, or UMPD. With this coverage, the cost of repairs and the cost of a rental car until the repairs are done are both recoverable. Unfortunately, some companies refuse to pay for the depreciation the vehicle suffers after repairs are done. Sometimes referred to in the trade as “diminished value”, consumers can lose thousands of dollars in the value of their vehicle even after properly performed repairs are completed. Although this recovery can be excluded under the collision section of the policy, state law prohibits excluding it from the UMPD coverage. However, many insurance companies simply refuse to pay this loss. They try to persuade the customer it isn’t covered under the UMPD or that the vehicle really didn’t suffer any loss in value. Most people take their word for it or simply give up, afraid to confront a major corporation. Millions of dollars are taken from customers pockets with this practice. Unfortunately until state regulators act to stop it, the practice will probably continue.
For more information on this subject, please refer to the section on Car and Motorcycle Accidents.