One of the most important, yet often misunderstood decisions when purchasing automobile insurance is the tort election option. This is an election that every person buying auto insurance in Pennsylvania must make.
When I first meet with clients who have been involved in auto accidents, one of the first topics we discuss is the tort election choice which applies to their policy with their auto insurer. Unfortunately, people do not realize the important effect and limitations the limited tort election may have on you and your household relatives in the event of an accident.
In short, Pennsylvania law states that you have given up the right to pursue a claim for non-economic damages including pain and suffering if you have selected the limited tort option. The problem is that insurance carriers, by and through their agents, do not fully explain the legal ramifications of making this choice. Sadly, what frequently happens is that the person purchasing coverage is simply presented with the cheapest option available which will always be the limited tort option.
While the law also requires the carrier to present a form containing specific language regarding the tort options and the premium quote for each, it is rarely fully explained or fully understood. The limited tort option may save you between $50-$500 per coverage period depending on the carrier and the individual’s insurance needs, but it may also bar your claim for compensatory damages. In other words, the money that you could’ve been entitled to if you opted for full tort coverage can far exceed the amount of money saved by electing the limited tort option.
Don’t Fall for “Full Coverage”
When discussing insurance coverage with new clients, they will proudly inform me that they have “full coverage” on their policy. There is only one problem – it DOES NOT exist in Pennsylvania. Unfortunately, unscrupulous or uninformed insurance agents may sell you a policy with the promise that you are receiving full coverage, but the term is a misnomer. The laws of the Commonwealth only require citizens purchasing automobile insurance to purchase the following coverages in the minimum amounts stated:
- Bodily Injury (Liability): $15,000.00 per person/$30,000.00 per accident
- Property Damage: $5,000.00
- First-Party Medical Benefits: $5,000.00
The first coverage, bodily liability, protects you against claims by other injured drivers if you are at fault for causing an accident. The second coverage, property damage, likewise protects you against the claim of the other driver but this time for a claim for damage to their vehicle. The final coverage, first-party medical benefits, also called Personal Injury Protection, or PIP, pays for your (and resident relatives’) medical bills following an accident regardless of who was at fault.
That means that all of the following coverages are not in fact legally required: Uninsured Motorist Coverage, Underinsured Motorist Coverage, Collision, Comprehensive, Income Loss, and Funeral Benefit. While insurers are legally required to offer you uninsured and underinsured coverage you do not have to carry the coverage and those are some important coverages. Unfortunately, when purchasing the minimum coverages discussed above, your insurance company or its agent may then declare you to be “fully covered” when this does not exist and is probably not the case.