The Importance of Uninsured and Underinsured Driver Coverage

Posted on Feb 12th, 05:04 am, under Are You Covered?

Have you ever asked yourself if you've got sufficient coverage already? You may be in need of auto insurance against uninsured and underinsured drivers. If you think they're pretty much the same thing, think again; these are two completely different forms of insurance. Here are the basics that you'll need to know in order to avoid liability on the road.

Uninsured drivers are those motorists who have, as the term implies, absolutely no auto insurance of any kind. If you are unfortunate enough to get into an accident with one of these individuals, your situation should technically be resolved in court. In reality, however, it's highly unlikely that you'll get any compensation from them, since medical and vehicle damage costs in the United States are extremely high. This is why you need an insurance policy that protects you against uninsured drivers. Fortunately, most states require this form of coverage as a mandatory add-on to any insurance policy. If your state doesn't require it, consider adding uninsured drivers coverage (UM) to your policy.

Underinsured driver coverage (UIM), on the other hand, protects you against at-fault motorists that have some auto insurance, but not enough to pay for damages in an accident. This issue is steadily becoming more important, since the minimum basic liability insurance that many states require still isn't enough to cover the damages of most collisions and accidents. Once more, this is due to the ever-increasing costs of health care and vehicle repair in the country. Therefore, in addition to UM coverage, you should also look into getting UIM as well.

Aside from the benefits listed above, UIM also helps to cover lost wages and medical costs if you get into an accident through the fault of another motorist. It really helps "fill in the gap" by compensating you for costs that aren't covered by the at-fault driver's auto insurance or your own health insurance.

But what if YOU are that underinsured motorist? How will you know? Legally defined, an individual is considered underinsured if he or she does not carry liability coverage for bodily injury and property damage. The laws regarding underinsured motorist coverage vary depending on your state. For example, in Florida, UM and UIM insurance is required. In other states, such as Texas, filing an uninsured motorist claim will increase your insurance rates. Because of all the different variables and laws, the best way to find out your personal insurance status is to ask your auto insurance agent for more information.