Uninsured Coverage for Property Damage or "UMPD"

Part II

The edge that Uninsured Coverage or UMPD gives you is often overlooked. Insurance carriers just look on the other direction when this claim is made. Attorneys do not take this claims because it is a difficult argument little information on them and what you gain will not make enough money for the attorney (they will rather not make this claim), or they simply just do not know they can claim this.

Many insurance carriers are lobbying hard to change this so you are barred from making this claim (you want to check with your insurance commissioner BEFORE you call). This is one of the biggest secrets I would reveal in this website. So listen up!

It is called a diminished value claim. You can only make this claim if you have Uninsured Coverage or UMPD, and It applies to your own car damages. For example, your vehicle is in a wreck, then when the time to sell comes, the vehicle will not be worth the same value as if did not any accidents in its record, or will it?

If you are, a buyer and you learned that this vehicle was in a car wreck, would you pay the same amount of money? Some people will say that they would if the car was fixed right (but how can you tell really?).

By know you know that if insurance had anything to do with fixing this car, then aftermarket parts were used. Seriously, even if you think the car was fixed the correct way, wouldn’t you use this information to bargain for a better price? I think you would.

Again, if insurance had anything to do with this vehicle, it is very likely that sites like www.carfax.com (a web site that will look at your vehicle accident history) will find out about your accident and will report it.

As you can see this is a difficult claim to make (read more on property damage claims), but it is not impossible. The reason why I bring this up here is because your Collision coverage excludes this claim. They will not come out and say: “we exclude Diminished Value Claims”, but they will say, “we will only pay to fix or replace property damage”.

This seems harmless language, but they will tell you that a diminished value claim is an “economic damages claim” not a “property damage claim”. They have agreed to fix the car or to deem it a total loss, nothing else.

However, under the Uninsured Coverage or UMPD there is no longer an agreement between first party and insurance carrier. Now you have a third party and insurance carrier claim, not bound by this type of language. They would owe you to put you back in the position you were before the accident (this includes economic losses).

The next point I would like to bring up are some of your responsibilities and duties under Uninsured Coverage or UMPD. Most policies required that you file a police report. This is critical.

You must file a police report! They could deny coverage if there is no police report. This is especially important if there is a hit and run situation. If you do not report it and there are no INDEPENDENT witnesses (some that does not know you), then you will be out of luck.

Note: some police departments will NOT come out to an accident scene if there are no injuries, if they believe the accident was minor, or if it was in a parking lot (private property).

They should come out and investigate if there is a hit and run, but if they believe, it is too late or there is not much they can do, they will NOT come out. This is completely discretionary for the police department and you cannot hold them liable for that.

However, you can go to the nearest police station and file a Walk-In report. In this report, you will be asked to write down what happened, at what time, and pertinent details. This will ensure your coverage.

Insurance carriers go easier on you if there is physical evidence of the loss. What do I mean? Yeah, if you have a phantom vehicle claim then they want more than just your statement.

A Phantom Vehicle Claim? What is that? This is a claim were someone causes an accident but make no contact with you or anyone and they leave the scene. For example, you are driving down the road and someone pulls right in front blowing the stop sign.

You are able to avoid them and not collide with them, but you go into the ditch and damage your car. The person that pulls out of the stop sign just leaves the accident scene. This is a phantom vehicle claim, not a hit and run. Technically, there was no hit.

The difference is critical because insurance companies will NOT provide coverage unless you have a police report. They want to make sure you just did not go into the ditch and blamed it in an imaginary person.

The beauty of the Uninsured Coverage (UMPD) as well as the under/uninsured Bodily Injury (UMBI) coverages is the fact that you become a third party, but you retain the rights of the first party. What does this mean? This means that the insurance company has to always act in good faith or you can sue them. A bad faith lawsuit is the “joker in the deck”. (Read more about bad faith).

Since the risk of getting in an accident with an Uninsured Coverage or UMPD is so high, this coverage is well worth the money; even if you only buy Liability. You could do Liability and Uninsured Coverage or UMPD.

To Read Part 1 of the Uninsured Coverage or UMPD article, click here.

If you are injured by an uninsured driver, you must carry Unisured Motorist Bodily Injury (UMBI). Read more about this coverage.

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