Posted by H. Lee Pruett
Under Georgia law, an insurer must offer uninsured motorist coverage as part of an automobile liability policy. Uninsured motorist coverage provides coverage for the insured’s injuries and/or property damage when an at-fault party has no liability insurance. It may also be used as “underinsured” motorist coverage when the insured’s damages exceed the at-fault party’s liability limits. The insured may reject the coverage in writing.
In 2008, the Georgia legislature amended O.C.G.A. § 33-7-11, the Georgia Uninsured Motorist Act, to provide for an additional uninsured motorist coverage option which must be offered in all automobile policies issued or renewed on or after January 1, 2009. Prior to the amendment, if the insured had uninsured motorist (“U/M”) coverage, and the at-fault party had liability coverage, the insured was underinsured only if the available uninsured motorist coverage exceeded the available liability coverage.
For example, if the insured has $100,000 in U/M coverage, and the at-fault party has the same amount in liability coverage, there is no U/M coverage available because the U/M carrier is entitled to offset the liability coverage. Under the amended statute, this option is still available to the insured.
The amended statute adds another option, however, which, for an additional premium, provides that the U/M coverage is added to whatever liability limits are available. In the example above, the insured would be able to add on the U/M coverage of $100,000 to the liability coverage of $100,000 for a total amount of $200,000.
This is a major change in automobile insurance coverage. While giving added protection to insureds that choose the add-on option of uninsured motorist coverage, it will significantly increase the uninsured motorist carrier’s risk in serious accident cases.