On July 2, 2024, North Carolina passed Senate Bill 319, marking a significant change in the state’s auto insurance landscape. These changes, particularly the adjustments to minimum liability limits, will have important implications for those injured in car accidents. Below, we address key questions regarding these changes and how they may impact you or someone you know.
Q1: What are the new minimum auto insurance liability limits established by Senate Bill 319?
A: Starting July 1, 2025, the minimum auto insurance liability limits in North Carolina will be raised to $50,000 per person and $100,000 per accident for bodily injury, alongside a $50,000 limit for property damage per accident. This is a substantial increase from the previous minimums of $30,000 per person and $60,000 per accident.
Q2: Why are these changes significant for accident victims?
A: The previous limits often left victims with inadequate compensation for their medical bills, lost wages, and pain and suffering. Under the old system, if multiple people were injured, they would have to share the limited $60,000 available. Many drivers were effectively “judgment proof,” meaning that even if a jury awarded a victim a significant amount, they could only collect up to $30,000 from the at-fault driver’s insurance. The new limits offer better protection for those seriously injured in car accidents, allowing for more comprehensive coverage of medical and other expenses.
Q3: Will these new limits apply to all insurance policies?
A: No, the new limits will apply only to policies written or renewed on or after July 1, 2025. Existing policies may not automatically reflect these new limits unless they are renewed or rewritten. It’s important for consumers to understand their current coverage and to consider upgrading their policies as necessary after the law takes effect.
Q4: How does this legislation affect property damage claims?
A: The new law raises the minimum property damage limit from $25,000 to $50,000 per accident. This change is particularly important for victims whose vehicles may have substantial value, ensuring they receive more adequate compensation for damages.
Q5: What is Underinsured Motorist (UIM) coverage, and how is it affected by the new law?
A: When SB 319 becomes law on July 1, 2025, UIM coverage will be mandatory in North Carolina including for policies with minimum limits. As a practical matter, that means that every liability policy will include combined Uninsured/Underinsured Motorist Coverage. UIM coverage provides additional protection for drivers when the at-fault party’s insurance is insufficient to cover damages. For example, if a victim suffers $100,000 in medical expenses but the at-fault driver only carries $50,000 in liability coverage, UIM can help bridge that gap.
Senate Bill 319 eliminates the “liability setoff,” meaning that UIM coverage can now be collected in full without being reduced by the amount paid by the at-fault driver’s liability coverage. In our earlier example, the victim could collect a total of $150,000 instead of just $100,000. This is a significant benefit for victims facing high medical expenses.
Q6: Should drivers consider increasing their UIM coverage?
A: Absolutely. Given that the new law allows for higher liability and UIM limits, we strongly advise clients to purchase as much UIM coverage as they can afford. This additional coverage can be crucial in ensuring that victims receive adequate compensation in the event of an accident with an underinsured driver.
Q7: What should someone do if they are injured in a car accident after these changes take effect?
A: If you are injured in a car accident, it’s essential to consult with one of the experienced car accident attorneys at The Law Offices of Jason E. Taylor. They can help you navigate the complexities of insurance claims, advocate for your rights, and ensure that you receive the compensation you deserve under the new laws.
Conclusion
Senate Bill 319 brings crucial changes that enhance the protections available to North Carolinians injured in car accidents. As we approach the July 1, 2025, implementation date, it’s vital to reassess your auto insurance policies and consider increasing your coverage limits, especially for UIM. Staying informed and proactive can make a significant difference in the event of an accident. If you have further questions or need assistance, don’t hesitate to reach out to our firm. We are here to help you understand your rights and navigate the complexities of auto insurance claims.
