How Much Underinsured Coverage Do I Need?

philFrankelI constantly urge motorcyclists to look at and increase uninsured/underinsured (SUM) coverage. I recommend that you purchase the highest coverage your insurance company will sell, but how much do you really need?

As a reminder, uninsured coverage will pay you money if 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 if they have less insurance coverage than you.

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 $100,000/$300,000 insurance policy, you can collect $100,000 from the car and your insurance company can pay you an additional $200,000 for a total of $300,000.

A very important side benefit to having a high underinsured limit is that it can substantially speed up your case and get money to you much faster. When your injuries keep you out of work, you need money quickly, not years later. If you don’t have health insurance, you’re going to need a lot of money very quickly.

When you have high underinsured coverage, the car’s insurance company will usually pay the entire $100,000 quickly because, otherwise, we could not get the additional $200,000 from your insurance company, without going to trial with the car’s insurance company.
Once the car’s insurance company offers to pay their $100,000 insurance policy, the underinsured claim against your insurance company can paid or decided by arbitration within months instead of a lawsuit which takes years. Additionally, an arbitration will save you trial expenses which can cost as much as $15,000-$25,000.

So, how much underinsured coverage do you really need? Injuries in many motorcycle accidents can keep you out of work for 6-12 months. Additionally, injuries from motorcycle accidents are frequently worth as much as $400,000 to over $1 million and sometimes several million as with the loss of a leg.

1) Determine how much money you will need if you are unable to work for a year. This is the least amount of underinsured coverage you should have.
2) If you don’t have health insurance or could lose it if you’re out of work, add a minimum of an additional $50,000-$100,000.
3) Then decide how much more money you want in the event you are injured by someone with only $25,000 coverage.
4) Add 50% because 1/3 of the total will be paid for your legal fees.
5) Purchase underinsured coverage in the amount which is the greatest of what you need or what you want (+50%).
We have found that most motorcyclists have only $25,000 uninsured coverage with $0 underinsured coverage or $50,000 uninsured/underinsured coverage. This is inadequate to protect you in the event you are injured.
I called 11 insurance companies 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). These are the results:
• Chubb will sell as much as you need.
• Liberty Mutual and Nationwide stated they sell a maximum of $500,000 per person underinsured coverage.
• Progressive and GEICO stated they sell a maximum of $300,000 underinsured coverage.
• Allstate, State Farm, Esurance, Dairyland, Farmers & MetLife stated they sell a maximum of $250,000 per person underinsured coverage.

You should review your coverage every time you renew your policy or 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. If you have any questions about your insurance coverage, please feel free to call me 7 days/nights to discuss it for free.
If you’re involved in an accident, even if another lawyer doesn’t think you have a case, call us immediately for a free consultation.
If you have a question for an article, anything else, or would just like to say hello, please call Phil Franckel at 1-800-HURT-911 or send your question to

Philip L. Frankel Esq. and Rob Plevy, Esq. are attorneys with FRANCKEL & PLEVY, LLP representing people hurt in motorcycle and other accidents. Disclaimer: This article should be considered advertising to represent people HURT in an accident; is for informational purposes and should not be relied upon because it could contain errors; the correct information may be different for your set of facts even though they seem similar; and is not legal advice which should only be obtained by contacting Phil Franckel, Esq. or Rob Plevy, Esq. for a free consultation to discuss your specific circumstances at 1-800-HURT-911.

See our web sites, and If you have been hurt in a motorcycle accident, speak directly to Phil Franckel 24/7 at 1-800-HURT-911 — 1-800-487-8911.