Minnesota Motorcycle Accident Insurance Coverage


Uninsured / Underinsured Motorist Insurance Loophole

Got Coverage? Maybe not.

The Minnesota No-Fault Automobile Insurance Act requires all insurance companies to provide the following uninsured / underinsured coverage for motor vehicles:

  • basic economic losses
  • medical expenses
  • minimum levels of uninsured / underinsured coverage

There is a major loophole in the Minnesota No-Fault Automobile Insurance Act. They do not specify that motorcycles are a “motor vehicle”. That precludes them from the provisions of the act and it allows insurance companies to write policies that protect their own interests at the expense of the policyholder.

This loophole was recently exposed in the Johnson v. Farmers decision.

  • The plaintiff incurred at least $134,000 in damages.
  • The defendant was totally at fault and carried only $30,000 in liability coverage.
  • The plaintiff settled for $34,000 and then filed with his own insurance for the difference of $100,000 maximum allowed on his UIM policy.
  • Unknown to the plaintiff, his policy contained a “limits-less-paid” reducing clause allowing the insurer to deduct the amount of the settlement.
  • That translates into $66,000 from the plaintiff’s insurance company, leaving the plaintiff footing the bill for the additional $34,000.

Many attorneys say the decision goes against settled law stating that ambiguities should be resolved against insurers. Steve Terry, founding partner of TSR Injury Law and motorcycle enthusiast, was quoted in the June 1st, Minnesota Lawyer reflecting on the decision,

“If the statute is ambiguous and the contract with the underinsured carrier is ambiguous, it should be held against the insurance carrier. The court did just the opposite . . . they gave the insurance company the benefit of the doubt and [ruled against] the person who was hurt.” He then added, “In most contexts you hold doubts against the one who wrote the policy. [The Court of Appeals] seems to be getting more and more conservative and becoming more and more insurance-company friendly. If a case could go either way, if there is ambiguity, it’s being resolved in favor of the for-profit insurance company and against injured consumers.”

This is a disturbing situation because no one reads their insurance policy completely. It leaves the door open for abuse. Any motorcycle policy can now say anything as there is no regulation whatsoever.

Contact Minnesota Motorcycle Accident Attorneys

The Minnesota Motorcycle Accident Lawyers, of TSR Injury Law, are expert Personal Injury Lawyers and skilled litigators. They will represent you aggressively in your motorcycle accident case. Call 612-TSR-TIME or submit our free consultation form.

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