Idaho Uninsured and Underinsured Motorist Coverage Election

Effective March 28, 2018, all private passenger automobile insurers in Idaho must use the NEW Uninsured and Underinsured Motorist Disclosure found in which includes election/selection form found in Appendix A of the Idaho Administrative Code at IDAPA 18.01.20 Section .016.  Carriers must begin using the new form for all new policies and those existing policies where UM or UIM coverage is added or removed no later than January 1, 2019.  Carriers may make nonsubstantive changes to this form, for example, including inserting company letterhead, and carriers must file their standard statement forms with the director prior to use. This rule does not create new requirements for the types of UIM coverage carriers must offer.

The example set forth in the Administrative Rule is displayed with some text set forth in boxes.  I have included an illustration of the content of Appendix A below but caution you that this will display differently when viewed in some devices and some formatting changes were necessary to display in this blog.  This is merely an approximate illustration and the actual Rule should be consulted before adoption of the form.

APPENDIX A (UNINSURED/UNDERINSURED MOTORIST DISCLOSURE)

IDAHO UNINSURED MOTORIST AND UNDERINSURED MOTORIST DISCLOSURE — Do not sign until you read

Idaho law requires that every auto liability insurance policy include Uninsured Motorist (UM) bodily injury coverage and Underinsured Motorist (UIM) bodily injury coverage, unless a named insured (you) has rejected these coverages in writing, which may be in electronic format.

These coverages can protect you and your passengers by paying damages, up to the UM/UIM policy limits you have chosen, when an at-fault person does not have any or enough liability coverage.

  • UM coverage may pay damages for bodily injuries caused by an at-fault motorist who has no insurance, or from a hit-and-run vehicle where the at-fault party is unknown.
  • UIM coverage may pay damages for bodily injuries if the at-fault motorist does not have enough liability insurance to cover your costs. UIM coverage is offered in different types by different insurers, and insurers are not required to offer more than one type of UIM coverage. The most common available type of UIM coverage is “Difference in Limits” (or “Offset”) Coverage. Some insurers may offer “Excess” Coverage. Please refer to the attached examples to see how the different types of UIM coverage may impact your level of protection.

You have the option to purchase both UIM and UM coverage in varying amounts at or above the minimum liability requirements in Idaho, which are $25,000 per person, $50,000 for two or more persons in any one accident. By signing below, you acknowledge that the insurance company has explained the following UM/UIM coverages that are available as part of your policy:

Insurer: ______________________ UIM Type:       Difference in Limits (Offset)          Excess

I have read the above explanation of Uninsured Motorist and Underinsured Motorist coverages. I understand that I have the option to reject either or both coverages.

 

Named Insured (print name) __________   Signature of Named Insured ___________  Date _______

UNINSURED AND UNDERINSURED MOTORIST COVERAGE – OPTION TO REJECT

I understand that, by signing below, I am informing my insurer that I choose to reject the UM/UIM coverage(s) under my automobile liability policy, or under any renewal or replacement of my policy.

I reject and do not wish to purchase Uninsured Motorist Coverage (UM).

_________________________­­­­­­­­­__________                         _________

Signature of Named Insured (only if rejecting)                           Date

I reject and do not wish to purchase Underinsured Motorist Coverage (UIM).

_________________________­­­­­­­­­__________                         _________

Signature of Named Insured (only if rejecting)                           Date

This general explanation is NOT an insurance agreement. All auto insurance policies have terms and conditions that control your rights and obligations as a policyholder. For a more detailed explanation of these coverages, refer to your policy, agent or the insurer. The Idaho Department of Insurance can also provide assistance with insurance related questions. Call 800-721-3272 (Idaho only) or 208-334-4250 or visit the Department’s website at www.doi.idaho.gov.

Definition of the type of UIM coverage

“Difference in Limits” (or “Offset”) UIM

Your UIM coverage limits are reduced or eliminated by any amounts recovered from another party’s insurance.

“Excess” UIM

Your UIM coverage limits are above and beyond what is paid by another party’s insurance.

Example 1

At-fault motorist and you have the same bodily injury/UIM coverage limits

                                                                              “Difference in Limits” 

                                                                               (or “Offset”) UIM          “Excess” UIM

Bodily Injury liability limit of at-fault motorist          $25,000                      $25,000

Your Underinsured Motorist (UIM) Coverage limit   $25,000                     $25,000 Maximum available for your bodily injury                    $25,000                     $50,000

Example 1 explanation:     

  “Difference in Limits”: Your UIM coverage doesn’t provide additional coverage above the at-fault motorist’s coverage because they have the same limit

“Excess” UIM: Your UIM coverage increases the available Bodily Injury coverage above the at-fault motorist’s coverage limit

Example 2

At-fault motorist has lower bodily injury coverage limits than your UIM

                                                                            “Difference in Limits” 

                                                                               (or “Offset”) UIM       “Excess” UIM

Bodily Injury liability limit of at-fault motorist       $25,000                        $25,000

Your Underinsured Motorist (UIM) Coverage limit  $100,000                  $100,000 Maximum available for your bodily injury                   $100,000                  $125,000

Example 2 explanation:

  “Difference in Limits”: Your UIM coverage covers any deficiency in the at-fault motorist’s Bodily Injury coverage, as if the at-fault motorist had Bodily Injury coverage at your UIM limit.

“Excess” UIM: Your UIM coverage increases the available Bodily Injury coverage above the at-fault motorist’s coverage limit

* * * * *

This blog should not be considered as legal or other advice.  It is solely to put you on inquiry notice of this change in the Idaho Administrative Code and the requirements to conduct the business of Private Passenger Auto Insurance in the State of Idaho.  You can contact Jeff Nash at 440.759.0817 if you wish to engage the assistance of The Nash Group.  Engagements may only be formed pursuant to a written Engagement Agreement.