Underinsured Motorist Laws Change in Delaware

Following is a copy of “Underinsured Motorist Laws Change in Delaware” as it appears in the October 2013 issue of the Delaware Trial Lawyers Association’s DTLA Advocate publication.

The underinsured motorist bill (Senate Bill 61) passed the Senate and the House last legislative session, and was signed into law by Governor Markell on July 3, 2013. This new law allows injured parties to pursue their UIM policies up to the extent of their damages (of course, only up to their UIM limits), regardless of the tortfeasor’s bodily injury policy limits. In other words, UIM is “triggered” based on damages rather than “triggered” only if the injured party’s UIM policy limits are higher than the tortfeasor’s bodily injury policy limits.

For example, let’s assume that you are significantly injured in car accident, and the person responsible for the accident has $100,000 of bodily injury coverage. If you had $15,000, $25,000, $50,000, or $100,000 of underinsured motorist bodily injury coverage, your underinsured motorist benefits would be equal or less than the responsible party’s liability coverage, and your underinsured motorist coverage would not be “triggered” (and could not be tapped into, even if your injuries were deserving of more than the $100,000 of liability limits available). Under the new law, the underinsured motorist policy limits no longer have to be higher than the responsible party’s liability limits to be accessed. In the above example, you are now permitted to obtain the $100,000 of liability coverage, and also pursue your underinsured motorist policy up to the extent of your underinsured motorist policy limits (assuming that the damages are worth in excess of the liability limits).

The new law states that “The provisions of this law shall apply to motor vehicle insurance policies issued and/or renewed six (6) months after enactment.” My reading of this language is that the new law starts on January 3, 2014 (6 months after being signed into law on July 3, 2013), and only applies to policies that are issued or renewed after January 3, 2014. Therefore, a policy that is issued or renewed on December 31, 2013, for a one year term (lasting until December 31, 2014), may not apply the new UIM “triggering” law.

My recommendation is that you inform your clients of this new UIM law, and insist that they renew their policies as soon as possible after January 3, 2014 so that their policy will apply the new UIM law.

This new law is a tremendous success for DTLA in protecting injured victims and getting our clients what they deserve. It would be unfortunate if a client came into your office with significant injuries from a motor vehicle accident after January 3, 2014, but still had a policy issued prior to January 3, 2014, and your client was not able to benefit from this new law.