Car owners and policyholders in the state of South Carolina may run into some problems if they file for insurance claims. According to legal and insurance experts, the state has a long history of civil suits filed by policyholders against insurance providers. Most of these cases have resulted in decisions still used by providers and the courts to come up with appropriate rulings.
Many of these cases dwelt on the issue of uninsured and under insured drivers. The state’s insurance laws, analysts say, have caused a great deal of confusion for many residents and car owners. According to experts from the South Carolina auto insurance industry, the state government does not require drivers to purchase underinsured motorist (UIM) insurance at present. However, state insurance officials do mandate that providers must offer UIM coverage to their clients. The final decision to purchase UIM coverage is left to the policyholder. This has resulted in a variety of cases stemming from the state’s policy.
In a landmark case back in 2000, a state appellate court ruled that insurance companies may offset the amount of insurance compensation policyholders are entitled to if they find other sources of compensation for their injuries. For instance, this means that motorists injured while driving company vehicles may have to contend with less insurance compensation if they file for worker’s compensation. Policyholders who also file for UIM coverage claims can also find it difficult for insurance providers to comply.
However, South Carolina does require all car owners and drivers to have uninsured motorist (UM) coverage. Using the same ruling by the appellate court in 2000, insurance companies argued that they reserve the right to offset the amount of insurance compensation if the policyholders who file for UM coverage claims receive compensation from other sources. The state Supreme Court decided against this argument and reiterated that the providers must comply with state insurance laws and release the prescribed amount to the policyholders. Awarding less than the agreed upon UM coverage amount is illegal, the courts added.
This means that insurers can make use of offsets to reduce the amount of money policyholders can receive in the case of UIM claims. However, the same action is illegal if the providers decide to offset the insurance claims amount from UM coverage.
Insurance analysts say that the complexities of South Carolina’s insurance laws may require policyholders to contact experienced legal experts. An insurance attorney familiar with the state’s policies can increase the chances of a policyholder succeeding.
