Car Insurance from a Litigator’s Perspective

Many people don’t give their car insurance a second thought; they get the minimums that Nevada requires and assume they’re fine. Most litigators will tell you, however, that your insurance decisions are some of the most important decisions you can make when it comes to your future financial well-being. The first and most important issue any litigator will consider in the event of a car crash is the insurance status of all involved parties. If you don’t have enough insurance to cover the damage you accidentally cause, the person you hit doesn’t just give up and go home. No, they’ll go after your personal assets to satisfy their claims — your house, your car, your savings — whatever it takes to make them whole. Your insurance company won’t be there to save you if you didn’t buy the right amount of coverage.

Based on my experience litigating auto accidents here in Las Vegas, I recommend getting at least 100/200 in bodily injury liability coverage, matching it with your Uninsured/Underinsured coverage, and $50,000.00 in property damage coverage. I also recommend getting $10,000.00 in Medical Payments coverage if you can afford it. Remember – the base coverage for your policy is the most expensive part. Upping your limits is comparatively cheap.

It is extremely unwise to drive around in a city like Las Vegas with the minimum Nevada coverage of $15,000 per person/$30,000 (about to become $25,000/$50,000 as discussed below) total bodily injury coverage. I love Las Vegas, but we aren’t exactly a city that avoids litigation. We have a well-deserved reputation for being one of the more litigious cities in the country, and a large number of our lawsuits involve car accidents. Here are some things to consider when picking your coverage:

1.       Unless you’re “judgment proof,” you risk having a catastrophic hit to your financial future if you only carry the minimums.

  • “Judgment proof” is the colloquial term to describe someone who has little to risk in a lawsuit. Maybe someone can get a huge judgment against you if you hit them, but there’s nothing they can do to collect it because you have no home equity, an old car, and no property worth anything.
  • I carried minimum limits when I was in college because I knew that I had nothing of value anyone could take and sell, and we no longer have “debtors’ prisons.”
  • Judgments hang around a long time, though. Even if you’re judgment proof today, you might not be in 2-3 years and the plaintiff in that case can usually still enforce his or her judgment against you at that time. The last thing you want is to finally be making good money only to find out that the plaintiff is garnishing your wages three years later.

2.       Even a minor fender-bender can blow through $15,000.00 in bodily injury coverage in a matter of days or weeks.

  • It used to be that the primary method of car for a person involved in a car accident would be chiropractic treatment. This is still where many people start, and it can be all the treatment many people end up needing. However, if chiropractic treatment doesn’t end up resolving the pain, there could easily be a referral to a pain management specialist. These doctors often perform spinal injections or other methods to try and alleviate long-lasting pain and these treatments can cost anywhere from $3,000.00 – $10,000.00 per session even in a very minor accident.
  • Just because the law mandates a minimum coverage, that does not mean damages are capped at this amount. Only the most minor injury accidents can be resolved for $15,000.00 or less, so protect yourself and your financial future by increasing this amount if you can afford it.

3.       Uninsured/Underinsured Motorist Coverage is great.

  • When you think about getting into an accident, who do you expect to hit you in Las Vegas? The cardiologist on his way to the hospital? An investment broker coming home from a long day at work? Or, more likely, a teenager texting his friends while he drives home or a drunk coming off a 12-hour bender?
  • Teenagers and drunks don’t exactly prioritize insurance in their monthly budget. You’ll be lucky if they even have the minimum insurance coverage many times.
  • If you have a good Uninsured/Underinsured policy, though, it doesn’t matter. That’s because you’ll get the at-fault driver’s insurance limits and then turn around and tell your insurer that they owe you the rest of your damages.
  • In Nevada, the Uninsured/Underinsured motorist coverage has to cover all damages you could recover from the at-fault driver if he was adequately insured. This means your insurer steps into the shoes of the drunk guy that hit you.
  • Don’t expect your insurer to just cough up the money, though. If you are dealing with them directly, they’re some of the most difficult adjusters you can find, in my experience. If you are dealing with them without a lawyer, expect them to offer you pennies on the dollar because they assume you’re bluffing. If you were serious about filing suit, you’d have a lawyer and they know it.
  • As long as your lawyer understands the policy, the laws of Nevada, and can lay out (“blackboard”) your damages you will present at trial, you can get a great recovery from your insurance carrier.
  • Be careful, though – talk to a lawyer before settling with the at-fault driver’s insurer. If you don’t know what you’re doing, you can screw up your claim.

4.       Medical payments coverage is also great. If you can afford it, bump up this coverage.

  •  “Medpay” coverage is fantastic because you can use it to pay your medical bills and your insurer has no right of subrogation in Nevada. This means you can sue the at-fault driver, collect damages for the bills you ran up and paid with Medpay, and your insurer doesn’t get a dime of that money because it’s a benefit you paid for.
  • You can also use it with the medical providers to get them to reduce their liens and put more money in your pocket if you know how to handle the situation.
  • Everything in this world is negotiable if you have the right leverage. To a good lawyer, medical bills are the beginning of the negotiation process and not the end. Nevada has very favorable laws for plaintiffs in terms of off-sets and write-downs for insurance, so talk to your lawyer early on about how much your case may be worth.

Update: As of July 1, 2018, the State of Nevada will increase minimum required coverage to be $25,000.00 for an individual bodily injury coverage, $50,000.00 aggregate for bodily injury, and $20,000.00 for property damage. This is a great improvement and should help everyone injured in an accident have a better chance to get fully compensated. Sure, it may raise your premiums slightly, but it will be nice to know that if someone hits you, there should be more insurance available to assist you in your recovery.

For more details, go to the Nevada DMV site: