Walker Morgan LLC
Types of Insurances
Types of Insurances
When dealing with the aftermath of a burn injury, it’s likely that some type of insurance will be involved. Liability insurance, health insurance, property insurance, vehicle insurance, and/or worker’s compensation are a few of the most common types of insurance involved in burn injury cases.
Liability is a term used to describe legal responsibility. Liability insurance is a type of insurance which allows you to protect yourself, your property and your personal assets if you negligently cause injury to another person or another person’s property and are legally responsible for those injuries. As a result, liability insurance is generally designed to offer protection against claims made by third parties and does not offer protection if the insured is the one injured.
Motor vehicle insurance policies always include liability coverage, but liability insurance can come in a variety of alternative forms. Public liability insurance is a way for businesses to cover themselves in the case that a customer or member of the public is injured as a result of the business’s activities. Product liability insurance protects manufacturers from claims made when one of their products causes harm to a consumer. Workers compensation is a form of employer liability coverage.
Another characteristic of liability insurance is that it typically does not cover intentional acts. Most insurance policies include clauses that specifically exclude coverage for intentional acts. This ironically means that victims of intentional harm potentially have fewer recovery options than those who are harmed accidentally.
Health insurance can come in a variety of forms including directly from an insurance company, from an employer, or through social programs such as Medicaid or Medicare. According to the U.S. Department of Health and Human Services, Medicaid and Medicare cover nearly 45 percent of the costs associated with burn injuries annually.
Health insurance covers medical expenses regardless of where an injury occurred or who is responsible for the injury. This means that when someone is burned, health insurance is normally first on the line to pay for their medical expenses. If another party is determined to be responsible at a later time, the health insurance company may seek to recover their costs from the responsible party. This process, called subrogation, is discussed further in the Understanding Insurance Coverage page.
Without health insurance, a burn victim may be on the hook for their own medical expenses until they reach a settlement or obtain an award against the responsible party. This can potentially place burn victims in a difficult position.
Property insurance typically fulfills two roles. First, it protects the covered property (including both the land and structural component, such as a house) as well as the contents (such as furniture, electronics, etc.) from damage or loss caused by certain sources. Policies can vary, but many property insurance policies cover damage or loss from fire, windstorms, hail, lightning, theft, and vandalism while excluding damage or loss from floods or earthquakes. Second, property insurance provides liability coverage if a third party is injured on the insured’s property. Common examples of property insurance include commercial property, home owners and renters insurance.
While the liability coverage afforded under a property insurance policy may cover injuries to third parties, it typically does not cover injuries sustained by the policy holder. That means if you’re burned in your own home, property insurance is likely not going to be available to cover medical expenses. But if you are burned at a third party’s property—for example, if you’re burned while at a business—and the third party is responsible for your injury, you may be able to file a claim against the third party’s property insurance for your injuries.
Vehicle insurance is legally required in order to operate a motor vehicle on public roads, but the exact requirements vary from state to state. All states require that drivers have at least liability coverage for both personal injury and property damage—though the minimum amounts of these coverages again varies by state. When a driver is responsible for causing bodily injury to a third party, the driver’s liability coverage is typically responsible for paying the injured party’s medical expenses, pain, and suffering but only up to the policy limit.
However, not all drivers maintain active insurance policies or policy limits high enough to cover the full amount of damages caused. One way to avoid this risk is to purchase uninsured or underinsured insurance which is discussed further on the Coverage Limits page.
Another type of coverage often included in a vehicle insurance policy is personal injury protection (PIP) or medical payments (MedPay) insurance. PIP and MedPay are forms of no-fault coverage designed to provide medical coverage regardless of who was at fault in a motor vehicle accident. If there is PIP or MedPay coverage on a vehicle insurance policy, then those insurance proceeds are available to the insured and other covered parties to cover medical treatment for the injuries received in the motor vehicle accident up to the PIP or MedPay limits. In some cases, PIP coverage can also include coverage for lost wages, death benefits, and other reasonable non-health related expenses. Each policy should be evaluated individually to see exactly what types of coverage it provides.
Workers’ compensation was created as a means of protecting individuals who are injured on the job or develop occupational diseases. It protects workers by providing them an assured means of receiving wage replacement, medical benefits, and, in many cases, vocational rehabilitation so long as the injury was not intentional or, in some cases, a result of the employees own negligence. The system is also meant to protect employers, in that by providing workers compensation insurance to their employees, injured workers are then prevented from suing their employer for negligence when they are injured on the job. However, consulting with an attorney is often still beneficial in workers’ compensation cases in order to make sure that the injured worker receives all of benefits offered under the workers’ compensation plan.
The exact framework of workers’ compensation is determined at the state level by each state’s workers’ compensation commission. Links to each state’s website can be found at the U.S. Department of Labor. The U.S. Department of Labor also administers a workers’ compensation program for federal employees.