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Pennsylvania’s Auto Insurance Requirements

Pennsylvania’s Motor Vehicle Financial Responsibility Law requires all Pennsylvania drivers to carry auto insurance. Having adequate insurance is important to cover the damages that may result from motor vehicle accidents, including medical bills, lost wages and property damage. Pennsylvania drivers undoubtedly benefit from understanding the different types of insurance available and which ones the state law obligates them to purchase.

Liability Coverage

Liability insurance covers claims made against a driver for personal injuries from an accident that was his or her fault. Pennsylvania requires drivers to carry a minimum of $15,000 per person and $30,000 per incident.

People can purchase premiums with higher liability amounts, which insurance agents recommend if an individual has assets he or she wishes to protect. If a driver injures another person in an accident, the injured party can choose to accept the limits of the driver’s insurance coverage and release the driver from liability or the injured person can choose to sue the driver personally for the difference between the injured party’s damages and the limits of the driver’s insurance company. If an injured person chooses to sue the driver personally, the driver risks losing his or her home, car and savings.

A driver can also purchase liability coverage for property damage resulting from motor vehicle accidents in which he or she was at fault, but the law does not require it.

First Party (PIP) Coverage

State law also requires that drivers carry a minimum of $5,000 Personal Injury Protection (PIP) coverage. PIP coverage is a no-fault insurance policy that will pay a person’s medical bills regardless of who caused the accident.

Collision Coverage

Collision coverage is optional under Pennsylvania law. Collision coverage pays for repairs to a driver’s car when it is involved in a collision with another vehicle or an object, regardless of fault. Generally, a driver pays a deductible and then the insurer pays for the remaining portion of the repair costs. If the driver was not at fault in the accident, the insurer should recover the deductible amount from the at-fault driver’s insurance company and return it to the driver.

Comprehensive Coverage

Comprehensive coverage is also optional in Pennsylvania. Comprehensive coverage reimburses a driver if his or her car is stolen or sustains damage from fire, vandalism or various other ways besides an accident with another vehicle. Similar to collision coverage, a driver usually pays a deductible amount and the insurance company pays for the rest of the cost of repair or replacement.

Uninsured Motorist (UM) Coverage

Uninsured motorist (UM) coverage protects a driver in the event that he or she is involved in an accident with a driver who has not purchased insurance. Drivers may purchase UM coverage in amounts equal to or less than their liability coverage limits.

Uninsured motorist coverage is optional in Pennsylvania. However, the law does require insurers to offer this coverage to people when they are buying policies. Additionally, if drivers choose to waive this coverage, they need to sign separate forms indicating that they are refusing the coverage.

If drivers do elect to carry UM coverage, they may choose to “stack” the coverage if they insure multiple vehicles with one insurer. For example, a driver who has $20,000 of UM coverage but insures two vehicles would have $40,000 of coverage available if the driver got into an accident with an uninsured motorist.

The court has recognized two important exceptions to stacking coverage: the “household member” and “regularly non-owned vehicle” exceptions. If a person is injured in an accident owned by a household member or in a car they regularly drive but do not own, like a company vehicle, they cannot use their stacked UM coverage.

Underinsured Motorist (UIM) Coverage

Underinsured motorist (UIM) coverage applies when a driver is involved in an accident with another driver who was at fault and that driver’s insurance is insufficient to pay the bills for the driver’s injuries. This usually happens when a driver sustains serious injuries requiring extensive hospitalization and the at-fault driver only carried the minimum amount of liability insurance the law requires.

Similar to UM coverage, UIM covers is optional in Pennsylvania. However, the law also requires insurers to offer this coverage just like with UM insurance, and drivers also need to sign separate forms if they choose to waive this coverage.

Drivers may also choose to stack UIM coverage in the same way they can stack UM coverage.

Limited Tort and Full Tort

In an effort to help drivers pay lower insurance premiums, Pennsylvania lawmakers have adopted a system wherein drivers may elect to waive some of their recovery rights in exchange for paying less money in premiums. If a driver elects “full tort” coverage, he or she may recover for all damages suffered in an accident, including non-economic damages such as pain and suffering or humiliation. Full tort coverage costs a driver about 12 to 20 percent more in premiums, however.

A driver who chooses “limited tort” coverage pays less in premiums and agrees that he or she will not recover for non-economic damages unless the driver suffers a “serious injury.” The law defines serious injury as “a personal injury resulting in death, serious impairment of a body function or permanent serious disfigurement.” Courts have interpreted this to mean that soft tissue injuries do not constitute serious injuries, and even broken bones that heal and some head injuries are not severe enough to meet the definition.

Philadelphia Motor Vehicle Accident Lawyers at McCann Dillon Jaffe & Lamb, LLC Handle All Types of Auto Accident Claims

Dealing with insurance companies can be frustrating, and it becomes significantly more so when a person is recovering from injuries from an auto accident. If you have suffered injuries in a car accident, talk to an experienced Philadelphia personal injury lawyer at McCann Dillon Jaffe & Lamb, LLC who can deal with the insurance companies for you and help you to recover fully for your losses. Call us today at 215-569-8488 or contact us online to schedule a free initial consultation. We handle claims throughout Pennsylvania including the Philadelphia region, Chester County, Delaware County and Montgomery County as well as throughout Delaware and New Jersey.