Personal Injury Law Blog

In a recent ruling, the Illinois Supreme Court delivered a critical verdict that expands uninsured motorist coverage for pedestrians and bicyclists involved in hit-and-run or uninsured driver accidents. The court’s decision highlights that auto insurance companies, which have policies containing language requiring an individual to be in an insured motor vehicle to qualify for uninsured motorist (UM) coverage, are in violation of both the Illinois Insurance Code and the principles of public policy.

Illinois Insurance Requirements

Illinois insurance coverage laws encompass various aspects of insurance, with specific regulations governing auto, health, and property insurance. Regarding auto insurance, the state mandates that all drivers carry liability insurance to cover bodily injury and property damage in case of an accident. Minimum coverage limits are set to ensure financial responsibility, with requirements such as 25/50/20, meaning at least $25,000 for bodily injury per person, $50,000 for bodily injury per accident, and $20,000 for property damage. Moreover, Illinois law dictates that uninsured and underinsured motorist coverage must be offered as part of auto insurance policies, providing protection when the at-fault driver lacks sufficient coverage. 

Ruling in Galarza v. Direct Auto Insurance Company Expands Illinois UIM Coverage

In the case of Galarza, the Supreme Court made a significant ruling that broadened the scope of UM coverage. The court determined that a minor bicyclist hit by an uninsured motorist could be considered an insured party under the policy, even though the bicyclist was not inside a covered vehicle at the time of the incident. This decision has expanded the eligibility for UM coverage, ensuring that individuals like the minor bicyclist in this case can seek compensation for injuries caused by uninsured motorists.

Background of Galarza v. Direct Auto 

This case arose from a hit-and-run incident in Chicago in September 2020. Fredy Guiracocha submitted an uninsured motorist claim to Direct Auto on behalf of his then-14-year-old son, who had been struck by a driver while riding his bicycle. Under Guiracocha’s policy with Direct Auto, coverage is extended to family members. The teenager sustained injuries to his right arm, shoulder, and thigh, necessitating medical treatment.

Uninsured motorist coverage is designed to assist individuals in covering expenses resulting from accidents caused by uninsured drivers. However, Direct Auto rejected the claim, citing a clause in their policy stipulating that uninsured motorist coverage was exclusively available to insured individuals injured while inside an insured automobile, and the teenager was on a bicycle at the time.

While Direct Auto did not dispute the teenager’s status as an insured person under his father’s policy, they argued that section 143a of the Illinois Insurance Code did not mandate coverage for pedestrians or individuals not occupying a vehicle. The case proceeded to Cook County Circuit Court, where a judge issued an order granting summary judgment in favor of Direct Auto, asserting that the company had no coverage obligations.

Supreme Court’s Analysis of Illinois Insurance Code

In this case, the Appellate Court’s reasoning centered on Section 143a of the Insurance Code, which was intended to comprehensively mandate UM coverage, primarily aimed at safeguarding individuals insured under automobile liability policies. While the court acknowledged that insurers could limit their coverage to manage risks, UM coverage is obligatory to ensure that the insured would be adequately protected if injured in an accident where the at-fault party possessed only the minimum required liability coverage.

The key coverage criterion was whether the injuries arose from the ownership, maintenance, or use of a vehicle, including the uninsured at-fault vehicle, rather than whether the injured person was occupying an insured vehicle at the time of the incident. Consequently, the Supreme Court determined that the injured bicyclist, involved in an accident with an uninsured vehicle, met the definition of a “person” whose injuries were linked to the ownership, maintenance, or use of “a motor vehicle,” thereby entitling him to coverage under the policy.

What Happens if Insurance Coverage is Denied? 

Despite this new ruling, many accident victims experience delays and denials from insurance companies. When an insurance company denies coverage after an auto accident in Illinois, it can lead to a complex and potentially contentious situation for the policyholder. Policyholders must be aware of their rights and responsibilities under Illinois law. Insurance companies must act in good faith and fairly investigate and handle claims. If an insurer unreasonably denies a legitimate claim, they can be held accountable.

The Importance of an Attorney after an Illinois Car Accident 

Legal representation is crucial if an auto insurance company denies coverage in Illinois. Insurance policies are often complex, and disputes can be lengthy, requiring an attorney’s experience. A skilled Illinois car accident attorney can assess whether the insurance company acted in bad faith or violated regulatory obligations. Further, skilled negotiators can engage in productive discussions with the insurance company to seek a resolution, often achieving better results than policyholders can on their own. Finally, if negotiations fail, an attorney can guide you through the legal process, including filing a lawsuit against the insurer. They can build a strong case, gather evidence, and represent you effectively in court.

Have You Been Injured in an Illinois Motor Vehicle Accident?

If you were recently injured in a Chicago pedestrian accident or cycling accident, it is important you take a few minutes to understand your rights because you may be entitled to compensation for everything you’ve been through. At the personal injury law firm of Briskman Briskman & Greenberg, our experienced team of lawyers provides compassionate yet aggressive representation to accident victims and their loved ones. We handle all types of personal injury claims in Chicago and the surrounding communities, including slip and falls, car accidents, dog bites, truck collisions and more. To learn more about how the lawyers at Briskman Briskman & Greenberg can help with your case, give us a call at 877-595-4878. You can also connect with us through our secure online contact form. Calling is free, and we will not bill you for our services unless we can connect you with the compensation you deserve.