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Chapter 7 – Insurance Coverages for Car Accidents: Basic Requirements and Higher Options

It’s vitally important to understand the extent to which you are covered. And in the next chapter, we’ll see why it’s also important to understand how other drivers are covered.
In Pennsylvania, you get a minimum of $5,000 in medical expense coverage. Coverage for earnings you lose as a result of injury is an option that you can either buy or waive. If you buy wage loss coverage, the minimum you can get is $1,000 per month for five months. Most people give this kind of coverage almost no consideration, and if they’re in a car accident they are surprised by how little they can get while they’re unable to work due to their injuries.
Lost Earnings Coverage for Car Insurance
A thousand dollars a month is not a lot of money. It translates to about $5.75 per hour in earnings. If you earn more than that and you’re in an accident, your income while you are recuperating from your injuries will not cover what you’re losing from not being able to work. When people are in this position, they can’t stay out of work for very long because they start getting behind in their bills. It is therefore wise to get as much coverage as you can for wage loss
benefits from your auto insurance carrier.
Medical Care Coverage for Car Insurance
The state minimum for medical expenses is $5,000. At first glance, this may seem like a lot of money, but you need to look at the potential costs of medical treatment. A short trip in a medical helicopter will cost between $9,000 and $12,000. An inpatient stay in a hospital can easily run several thousand dollars per day. If your injuries are serious enough to warrant emergency transportation and extensive treatment, you will exhaust your medical coverage within a few hours or days of the accident. If you have other medical coverage, for example, through your employer, then you will use this other health insurance carrier to pay your bills after your auto insurance is exhausted.
Subrogation and Car Accidents
Using another health insurance carrier can create a problem if you were injured by another person and want to make a claim against that person. Your health insurance carrier may have what is called a right of subrogation, which means that the health insurance carrier has a right to get paid back any money that it paid out for medical care related to your injury. Their claim may be primary over yours, meaning they get all of their money before you get anything. After fulfilling your obligation to your health insurance carrier, you may not be able to get fair compensation for yourself. For this reason alone, it is wise to carry a higher amount of medical coverage in your automobile insurance policy.
There is another important reason to carry higher lost earnings and medical benefit coverages on your auto insurance policy: such coverage is cheap. If you compare the cost of $5,000 in medical coverage to the cost of a much greater coverage, you will see a relatively small difference.
Review your insurance policy, see what you have, and think about what you need and what your family may need. It is well worth the trouble to take the steps necessary to protect yourself and your loved ones.