Understanding Virginia’s New Insurance Law: Expanded Coverage for Accident Victims

Understanding Virginia’s New Insurance Law: Expanded Coverage for Accident Victims

Big changes in insurance laws took effect on July 1st, and we want you to know about it.

These changes will provide additional insurance coverage for you and your family if you are injured while covered by a Virginia car insurance policy.

What happened?

The new law allows “stacking” of uninsured motorist and underinsured motorist coverage, known as “UM/UIM” coverage.

UM/UIM coverage protects you if the negligent driver that causes an accident does not have any car insurance or does not have enough to cover your damages. If the at-fault driver has no insurance, then your UM coverage steps into the shoes of that driver and provides coverage for your injuries. If the at-fault driver had some but not enough coverage to cover your claim, under the old law your own UIM coverage would only apply if your insurance limits were higher than what the other driver had. And then your UIM coverage was entitled to reduce what it could be required to pay by subtracting the amount of coverage of the at-fault driver.

For example, if your case was worth $100,000, but the at-fault driver only had $50,000 in liability coverage. $50,000 would not be enough to cover the damages from your accident. If you had a UIM policy of $50,000, your coverage would not be available to pay your claim because it was not higher than the $50,000 policy of the at-fault driver.

As of July 1, when your policy renews, you are allowed to “stack” your UM/UIM policy with the at-fault driver’s liability policy so that both policies are available to cover your claim. This is a great new law for injury victims because it provides additional money to cover medical bills, lost wages, and other damages resulting from an accident.

While the law allows drivers to opt out of stacking their coverage in exchange for a small discount of the price of their premium, we recommend taking advantage of the additional coverage because you may need every dollar to protect yourself and your family.

The new law applies to every new policy or renewal of an existing policy after July 1, 2023.

If you have any questions, please give us a call at 804-359-5500.

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