Understanding SEF 44 Coverage in Alberta: What It Is, How It Works, and Why It Matters
Imagine you are involved in a serious car accident, and the other driver is at fault. After retaining the services of an experienced personal injury lawyer and filing your claim, you discover that the at-fault driver only has $200,000 of liability insurance. Unfortunately, your injuries, lost wages, and other damages total $500,000.
The at-fault driver’s insurance provider agrees to pay out the $200,000 policy limit, but without additional protection, you are left with a significant shortfall of $300,000 to cover the full extent of your injuries and losses. What can you do?
While Alberta law requires all drivers on the road to carry insurance, one important yet oft-overlooked type of coverage is the SEF 44 Family Protection Endorsement – or “SEF 44” for short.
For those unfamiliar with the term, SEF 44 coverage is an optional auto insurance add-on that provides vehicle owners with extra protection in the event that they or their family members are injured on the road by another motorist who is uninsured or does not have enough insurance coverage to pay for your injury claim.
In this article, we will break down what SEF 44 coverage is, how it works, and why it is important for drivers in Alberta to consider including this add-on in their insurance policies.
What is SEF 44 Coverage and How Does it Work?
In Alberta, all drivers are legally required to carry a minimum of $200,000 in third-party liability insurance to cover the cost of a victim’s bodily injury claim in the event of a motor vehicle accident. In many cases, however, a victim’s actual damages may greatly exceed a policy’s limit. SEF 44 acts as a top-up on the at-fault driver’s insurance whereby your own insurance company steps in to cover the difference between what the at-fault driver’s insurance pays and the actual cost of your damages, ensuring that you and your family receive adequate compensation even if the other party’s insurance coverage falls short.
In the hypothetical scenario detailed above where you have sustained $500,000 in damages but the at-fault driver’s insurance only covers $200,000, your SEF 44 endorsement would cover the remaining $300,000, ensuring you receive the full $500,000 needed to cover your losses.
Scenarios Where SEF44 Protection Kicks In
There are three main accident scenarios where SEF44 coverage comes into play:
- Uninsured Drivers: When at-fault drivers fail to carry insurance, victims may seek compensation from the Government of Alberta’s Motor Vehicle Accident Claims Fund. Unfortunately, financial relief from the Fund is limited to $200,000 for all victims, meaning that if multiple members of your family are injured or your damages are worth more than $200,000, you will be unable to receive adequate compensation for your injuries without SEF44 coverage.
- Hit-and-Runs: Similar to victims of uninsured at–fault drivers, victims of hit-and-run collisions may also seek compensation from the Fund. Once again, the Fund’s $200,000 limit may leave you under protected in the event of a serious accident without the additional help of SEF44.
- Underinsured Drivers & Serious Injury Accidents: While some drivers may opt for the bare minimum third-party liability insurance of $200,000 as previously discussed, other drivers may have third-party liability policies in excess of $1,000,000. Sadly, there are occasions where even $1,000,000 is not enough to cover a victim’s losses depending on the nature of their injuries and personal circumstances. In these events, SEF44 coverage kicks in to cover the remaining balance of a victim’s losses.
While no one anticipates being in a serious car accident, it is important to be prepared for the unexpected. SEF 44 coverage can help protect you and your family from the financial fallout of an accident caused by uninsured, unknown, or underinsured drivers to ensure that you receive full compensation for your injuries and losses.
Other Important Considerations
In addition to you as the policyholder, SEF 44 also covers your spouse, children, and any other dependents who live with you. Notably, SEF 44 coverage follows the insured, their spouse, and dependent relatives, not just their vehicles. This means that coverage may be available in the event that you or your loved one is injured as a passenger in another vehicle or struck by a vehicle as a pedestrian.
Accidents are unpredictable, and there is no way to control how much insurance coverage other drivers carry. SEF 44 coverage gives you peace of mind, knowing that you and your family are financially protected no matter what type of insurance other drivers on the road may have.
In tough economic times, many Albertans are watching their pocketbooks and cutting back on additional expenses. Fortunately, SEF 44 coverage is relatively inexpensive compared to the potential financial fallout of a serious accident with an uninsured or underinsured driver. For a small premium increase, SEF 44 offers substantial protection that can safeguard you and your family from life-altering financial strain.
When it comes to driving in Alberta, having the right insurance coverage is essential to protecting you and your loved ones on the road. With frost in the air and another Alberta winter just around the corner, now is a great time to review your auto insurance policy to make sure that you are fully protected in the event of a motor vehicle accident. SEF 44 coverage can ease some of the anxiety and stress that comes with an accident, allowing you to focus on recovery instead of how to make ends meet.
Questions?
Injured in an accident? Have questions? Don’t wait! Contact us today for a free phone consultation. Our experienced team of legal professionals will work with you and your needs to set you on the best path toward maximizing your health recovery and receiving the compensation you are entitled to.
Written by: Tyler van Vliet, Articling Student
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