What is Resident Relative Insurance Coverage?

Resident Relative insurance coverage potentially allows an injury claimant to use an auto insurance policy of another person, even if the injury claimant is not named on the insurance policy of the other person. With Resident Relative coverage an injury claimant could potentially use the insurance policy of a blood relative and/or spouse that lives with the injury claimant. Resident Relative coverage applies to Uninsured/Underinsured Motorist coverage and/or Medical Payments coverage, both of which are coverages provided under an auto-policy.

Uninsured/Underinsured Motorist coverage is used when you are involved in an auto-collision that was not your fault, and the at-fault party either has no insurance coverage or not enough insurance coverage to fully reimburse you for your injuries and/or other damages. For example, if you were involved in an auto-accident and the at-fault party only has $25,000 in insurance coverage available to reimburse you for your injuries, but your medical expenses were $75,000 then you would want to use any Underinsured Motorist Insurance available to you.

Similarly, Medical Payments coverage is used to pay for any medical expenses that you incur due to accident-related injuries. One of the main differences between Medical Payments coverage and Uninsured/Underinsured Motorist coverage is that with Medical Payments coverage you do not need to establish that the at-fault party did not have insurance coverage or did not have enough insurance coverage. Medical Payments coverage is available to an insured whether or not the at-fault party has sufficient insurance coverage. For example, if you received an ER Bill in the amount of $5,000 then you could use Medical Payments coverage to pay for the ER Bill. Medical Payments coverage is particularly useful to prevent medical bills from going into collections as payments under Medical Payments coverage are often disbursed much faster than payments under Underinsured/Uninsured Motorist coverage.

Resident Relative coverage can also be used in addition to any Underinsured/Uninsured Motorist Coverage that you have in which you are the named insured. For example, let’s say you are involved in an auto-accident through no fault of your own and your medical bills are $100,000. The at-fault party does not have insurance coverage, but you have an insurance policy in your name that provides for $50,000 in Uninsured Motorist coverage. The policy in your name is not enough to fully reimburse you for the cost of medical expenses. But let’s say you live with your sister who has an auto policy with $50,000 in Uninsured Motorist coverage and you are not named on your sister’s policy. In this scenario you could use your Uninsured Motorist coverage of $50,000 and your sister’s Uninsured Motorist coverage of $50,000 to cover the $100,000 in medical expenses.

In Colorado, Resident Relative coverage is available according to Statute. Specifically, C.R.S. § 10-4-601(13) states:

“Resident Relative means a person who, at the time of the accident, is related by blood, marriage, or adoption to the named insured or resident spouse and who resides in the named insured’s household, even if temporarily living elsewhere, and any ward or foster child who usually resides with the named insured, even if temporarily living elsewhere.”

It is important that Resident Relative coverage is provided for by statute, because this means that resident relative coverage is the law in Colorado, and insurers are responsible for adhering to it. Any policy provisions that attempt to narrow the statutory definition of “Resident Relative” should be declared void and unenforceable. This means that if someone has a Colorado auto-policy then any language in the policy which tries to exclude the use of Resident Relative coverage as defined by C.R.S. § 10-4-601(13) will not be enforceable.

A person can be deemed to be a resident relative even if the person does not primarily live at the address of the named insured. See, Grippin v. State Farm Mut. Auto. Ins. Co., 2016 COA 127. In other words, even if you do not always live with the resident relative, you may still be able to use the resident relative’s coverage. The applicable statute for Resident Relative coverage states that resident relative coverage applies when the resident relative “resides in the named insured’s household, even if temporarily living elsewhere.”

“The General Assembly did not expressly modify or define the word “reside” to restrict the class of insureds only to relatives who reside “primarily” with the named insured. . . . For example, the phrase “even if temporarily living elsewhere” allows a child who resides in the separate households of divorced parents to be covered by the statute even if he or she is temporarily living away on a study abroad program, at an overnight summer camp, or at a boarding school or college when the accident happens.” See, Grippin v. State Farm Mut. Auto. Ins. Co., 2016 COA 127.

If you been involved in an auto-accident through no fault of your own, and you are concerned about the amount of insurance coverage available, please give us a call.