The Benefits of Uninsured/Underinsured Motorist Coverage

Did you know that about one in eight drivers is uninsured, according to the Insurance Research Council? That means if you are involved in a car accident caused by someone who doesn’t have any liability car insurance, you could be stuck with hefty out-of-pocket expenses like medical bills, health insurance deductibles, and lost income. Fortunately, there is a way to protect yourself from this risk: uninsured/underinsured motorist coverage.

Uninsured/underinsured motorist coverage, also known as UM/UIM, is a type of car insurance that can pay for your injuries, your passengers’ injuries, and damage to your vehicle if you are hit by a driver who doesn’t have enough or has no auto insurance coverage. This coverage falls under liability insurance, which also covers damage you cause to other vehicles or drivers. Liability insurance is required by law in most states, but some states do not require uninsured motorist coverage.

In this article, we will explore the benefits of uninsured/underinsured motorist coverage and why you should consider adding it to your car insurance policy. Here are the main benefits of this coverage:

Protects you from financial losses

One of the most obvious benefits of uninsured/underinsured motorist coverage is that it can protect you from financial losses if you are injured by a driver who has no or insufficient insurance. Depending on your state, this coverage may consist of up to four coverages:

• Uninsured motorist bodily injury (UMBI): This covers your medical bills, lost wages, pain and suffering, and funeral expenses if you are injured by an uninsured driver.
• Underinsured motorist bodily injury (UIMBI): This covers the difference between your medical bills, lost wages, pain and suffering, and funeral expenses and the at-fault driver’s liability limit if they have insufficient insurance.
• Uninsured motorist property damage (UMPD): This covers damage to your vehicle if you are hit by an uninsured driver.
• Underinsured motorist property damage (UIMPD): This covers the difference between the damage to your vehicle and the at-fault driver’s liability limit if they have insufficient insurance.

For example, assume you have medical and automobile damages totaling $200,000. The other driver has insurance to cover only $100,000. If you have underinsured motorist coverage with a limit of $200,000, you can claim the balance against your insurance provider. Without this coverage, you would have to pay $100,000 out of your own pocket or sue the other driver for the difference.

According to Investopedia , underinsured motorist coverage is usually a relatively inexpensive add-on to your auto insurance policy cost but can prove beneficial if you’re in an accident where the driver who was found to be at fault does not have enough insurance to cover the cost of damages from the crash.

Gives you peace of mind

Another benefit of uninsured/underinsured motorist coverage is that it can give you peace of mind after an accident. Being involved in a car accident can be a traumatic and stressful experience, especially if you or your passengers are injured. The last thing you want to worry about is how to pay for your medical bills, car repairs, or other expenses.

Uninsured/underinsured motorist coverage can reduce your stress and anxiety by providing you with financial security and compensation for your injuries and damages. You don’t have to deal with the hassle of filing a claim with the other driver’s insurance company, which may deny coverage or go out of business. You also don’t have to go through the legal process of suing the other driver, which can be time-consuming, costly, and uncertain.

According to Forbes Advisor , uninsured motorist coverage can pay for lost wages if you can’t work because of the car accident, pain and suffering compensation, and funeral expenses. These benefits can help you cope with the emotional and physical impact of the accident and recover faster.

Enhances your liability insurance

A third benefit of uninsured/underinsured motorist coverage is that it enhances your liability insurance and fills the gaps in your protection. Liability insurance is the most basic type of car insurance that covers damage you cause to other vehicles or drivers. However, it does not cover your own injuries or damages if you are hit by an uninsured or underinsured driver.

Uninsured/underinsured motorist coverage can complement your liability insurance and provide you with more comprehensive coverage for different scenarios. It can also cover you if you are hit by a hit-and-run driver or a driver whose insurance company denies coverage or goes out of business.

Uninsured/underinsured motorist coverage is not the same as other types of car insurance such as collision, comprehensive, or personal injury protection. Collision coverage, which is optional and available in every state, can also cover your vehicle damage, whether the person that hit you is insured or not. However, collision coverage usually has a deductible that you have to pay before the insurance pays for the rest. Uninsured/underinsured motorist property damage coverage may not have a deductible or have a lower one.

Comprehensive coverage, which is also optional and available in every state, can cover damage to your vehicle caused by events other than collisions, such as theft, vandalism, fire, flood, or animal strikes. However, it does not cover damage caused by uninsured or underinsured drivers.

Personal injury protection (PIP), which is required in some states and optional in others, can cover your medical bills and lost wages regardless of who is at fault in an accident. However, it may have a limit that is lower than your actual expenses or may not cover pain and suffering or funeral expenses.

According to Progressive , uninsured/underinsured motorist insurance may be separate, combined, or consist of up to four coverages depending on your state. You should check with your insurance agent or provider to see what options are available in your state and what limits and deductibles apply.

Conclusion

Uninsured/underinsured motorist coverage is a type of car insurance that can pay for your injuries, your passengers’ injuries, and damage to your vehicle if you are hit by a driver who doesn’t have enough or has no auto insurance coverage. This coverage can protect you from financial losses, give you peace of mind, and enhance your liability insurance.

If you want to secure yourself from the risk of being hit by an uninsured or underinsured driver, you should consider adding this coverage to your car insurance policy. You can compare quotes from different insurance providers online or contact an insurance agent to find the best deal for your needs.

Don’t let an uninsured or underinsured driver ruin your day. Get uninsured/underinsured motorist coverage today and drive with confidence.