Don’t ever buy insurance with a family exclusion. Here’s how it worked for a recent client of mine:
Mom was driving, didn’t pay attention to the slippery conditions of a Maryland winter, and her car slid into oncoming traffic. Her vehicle was totaled, and more devastatingly, one of her twins the back car-seat was catastrophically injured. She had brain damage, requires a feeding tube, and now needs 24-hour care. Thinking they had done the right thing when they purchased GEICO insurance, their policy provided for $250,000.00 if they injured someone else, or if someone without insurance injured them.
However, there was a caveat that they didn’t pay attention to: if a family member was injured because of the negligence of another family member, the most the insurance would pay out is $30,000.00. That’s $30,000.00 for nursing care, medicine, therapies, wheelchairs, disability vans, and ramps to the front door. From a legal perspective, it was easy—the insurance company offered $30,000.00 without much more evidence than the initial hospital bill. From an emotional and financial perspective, however, it was devastating. The family needed to go on public benefits, which do not provide nearly the level of care that sweet girl deserves.