Very few people like thinking about insurance or dealing with insurance companies. However, it’s better to ensure you’re protected before accidents occur than after you or a loved one suffers a serious injury. Motorists in Alberta are legally required to carry liability insurance on their vehicles, but what if their insurance provides insufficient compensation for your damages?
Family Protection Insurance (SEF 44) is an affordable way to protect yourself and your families from a wide variety of accident insurance scenarios. However, it’s far from perfect, with several significant loopholes. Read on to learn how SEF 44 insurance works, and how James H. Browns and Associates can help you receive the compensation you deserve after an accident.
What SEF 44 Insurance Does
SEF 44 Coverage (also known as Family Protection Coverage) protects you and your family should anyone be injured in a motor vehicle accident where you are not at fault or only partially at fault. Suppose you’re injured in an accident caused by a person who is uninsured, underinsured, or flees the scene of an accident (i.e., a hit-and-run). In that case, you will likely be eligible for compensation from your insurance company in the event liable parties (and their insurance companies) cannot cover your damages. Along with the Alberta Motor Vehicle Accident Claims fund, SEF 44 coverage can help ensure you receive the compensation you need, even if the other parties can’t (or won’t) pay.
In most cases, SEF 44 insurance covers the same amount as your third-party liability insurance. For example, if your policy has $1,000,000 in third-party liability coverage, your SEF 44 coverage will also be $1,000,000.
We strongly recommend all drivers purchase SEF 44 coverage from their insurers. It can come in handy in many different situations, as outlined below:
Scenario #1: At-Fault Driver is Uninsured
Being injured by an uninsured driver is one of the worst-case scenarios. However, it does happen. Let’s say your claim ends up being $1,000,000 after consulting with an experienced injury lawyer. If you have $1,000,000 in SEF 44 coverage, you’re completely covered! However, you may not even need the full amount; you may be eligible to claim up to $200,000 from the Motor Vehicle Accident Claims Fund.
Scenario #2: At-Fault Driver is Underinsured
This is a much more common scenario: Suppose you’re injured by a driver who only has $200,000 in liability insurance, but your claim is worth $1,000,000. After taking the $200,000 from the at-fault party’s insurance, you’d be able to claim $800,000 from your SEF 44 coverage.
SEF 44 coverage can be a lifesaver in accidents that happen abroad. For example, in many parts of the United States, mandatory liability coverage is as low as $25,000 USD. In the event of a serious injury (and a stay in an American hospital), that won’t go very far! Rest assured, if you’re injured in a motor vehicle accident and are not at fault, you can access SEF 44 coverage for accidents occurring anywhere in the world.
Scenario #3: Hit-and-Runs
SEF 44 insurance can also protect you in hit-and-run scenarios. Let’s say you were injured in a hit-and-run, and your claim is worth $400,000. You would be able to claim $200,000 from MVAC (it was designed for this exact scenario), while the remaining $200,000 will be covered by your SEF 44 protections.
SEF 44 Limitations
While SEF 44 insurance is a valuable tool for accident victims to secure the compensation they need, it has two main limitations.
First, SEF 44 coverage only covers you to the limit of your Third-Party Liability Coverage. For example, let’s say that you have $1 million in liability coverage and are injured by someone who also has $1 million in coverage. The maximum you’d be able to claim here is still $1 million; SEF 44 can’t be claimed “on top of” the at-fault party’s insurance, unless you have more SEF 44 coverage than the at-fault party’s liability coverage.
Next, SEF 44 has plenty of loopholes for insurance companies to exploit in accidents with multiple injured persons. Specifically, insurance companies are only required to pay damages in excess of the at-fault party’s liability coverage, not in excess of your claim value. Let’s look at the example below:
You and 4 other people are injured in a car accident. The at-fault party has $1 million of liability coverage. However, all five injured people have claims worth $300,000. You’re all equally injured, so you’ll split the at-fault driver’s liability coverage, but that’s only $200,000 each, leaving you short $100,000.
You begin to worry, but then you remember your $1,000,000 SEF 44 coverage. Common sense would say that you could claim that $100,000 from your SEF 44 insurance, right? Wrong. The way SEF 44 is written, insurance companies only have to pay in excess of the at-fault party’s liability coverage. Since your claims are only worth $300,000 and the drive has $1 million in coverage, they don’t have to pay.
It’s a complicated (among other things) loophole, but unfortunately, it’s there. As of this writing, no insurance product in Alberta covers these gaps.
Attaining Fair Compensation with James H. Brown
Accident and insurance law is complicated! After sustaining a serious injury in a motor vehicle accident, you need an experienced legal team to help you secure the compensation you and your family need to move forward.
Since 1993, James H. Brown and Associates has been proud to stand up for Albertans’ rights, helping them get the justice and compensation they need to move forward. With over 200 years of combined injury law experience and a proven record of success, our team is ready to do whatever it takes to get you what you deserve while supporting you and your family every step of the way.
Have You Been Injured in a Motor Vehicle Accident?
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