After Georgia changed its UM (uninsured and underinsured motorist insurance) laws in 2009, the changes left people with “added on” type coverage and UE (uninsured excess) or reducing type coverage. The good kind ads itself to the policy of the person who caused the car accident. For example if the at fault driver had $25,000.00 in coverage and you had $50,000.00 in UM added on coverage, then if your injury was severe enough, you could recover $75,000.00.
If you have the excess type UM, then typically the maximum recovery would be $50,000.00, representing the bad guy $25k plus your $50k UM minus bad guy $25k for a total of $25k from bad guy plus $25k UM. BUT there is an exception. As with any uninsured motorist case you really should sit down with a lawyer.
In November 2010, the Georgia Supreme Court heard arguments on a case where the bad guy had $25k in liability insurance and the UM was only $25k excess type. The UM insurer refused to pay the $25k in Um, arguing that because the bad guy paid $25k, there was no exposure on the $25k UM policy. This case was different though. Here the injured victim had a Georgia Medical Lien filed against them by the hospital. As we explained in the page on Georgia Medical Liens, once properly filed, they have to be paid out in some fashion. At the Court of Appeals, the victim won the day and the Court ruled that because of the huge Georgia Medical lien, there was access available to the UM policy.
The argument began again before the Supreme Court and unfortunately, this time the victim lost. In State Farm v. Adams, the Georgia Supreme Court ruled that having to pay a huge hospital bill is not a reduction “by reason of payment of other claims or otherwise…” OCGA §33-7-11.
The victim argued to the Court that because the lien existed and had to be paid, that reduced the recovery they were getting from the bad guy and because the lien was for more than $25,000.00, they were entitled to still access the $25,000 from their UM policy. Unfortunately for the victim, this time the Supreme Court ruled against him. The remaining unanswered question is whether the Court will hold that ERISA subrogation claims by health insurance would count as “payment of other claims” and would allow deeper penetration in the Uninsured Motorist policy.