You’re very careful about your car’s insurance. With the philosophy, “Better safe than sorry,” you carry as much coverage as you can, so in the event of an accident, you don’t have to worry about how to pay for damages.
However, not all drivers are as responsible as you. What if someone hits your car who doesn’t have any insurance? Or what if they only carry the minimum amount of liability insurance, and it doesn’t cover the damage to your car? For situations like that, you’ll want uninsured and underinsured motorist coverage.
What Is Uninsured Motorist Coverage
Uninsured and underinsured motorist coverage are generally talked about together, and many insurance companies sell them together. But they are, in fact, two separate types of coverage. As its name implies, uninsured motorist coverage insures you in the event of being hit by someone who doesn’t have any liability insurance—or if the amount of insurance they have doesn’t meet the minimum requirement for your state.
There are two types of Uninsured Motorist coverage: UMBI, which covers bodily injury, and UMPD, which covers property damage. UMBI may also cover hit and run drivers, who drive off without providing you with their insurance information. However, UMPD tends not to cover hit and run, so any damages to your car likely won’t receive a payout.
What Is Underinsured Motorist Coverage?
Underinsured motorist coverage protects you if you’re hit by someone who does have liability insurance, but not enough to cover your expense. It’s also split into bodily injury and property damage.
If someone only carries the minimum amount of liability insurance, then in theory, they’re personally financially responsible for the remaining damages. In practice, however, they may not have the money, or it may take time and legal proceedings to get it from them. In the meantime, you still have car repair bills and medical bills. Underinsured motorist coverage takes care of these expenses.
Do I Need Uninsured or Underinsured Motorist Coverage?
Uninsured motorist coverage is required by law in 18 states, plus Washington D.C. Underinsured motorist bodily injury coverage is required in 14 states, and underinsured motorist property damage coverage is required in 4. If you don’t live in one of those states, though, is the coverage worthwhile?
Like any kind of insurance, it’s a gamble. What are the chances of the driver who hits you being uninsured? What are the chances that their insurance won’t cover all of your expenses? What will happen if you do get hit, and don’t have that coverage?
The good news is, both of these types of coverage tend to be very inexpensive. They’re only a few extra dollars per month, and just a fraction of the cost of liability coverage. If your current car insurance premiums are already stretching your wallet to the breaking point, then maybe hold off on getting uninsured or underinsured motorist coverage. But otherwise, it’s a very worthwhile investment.
You never know what’s going to happen. Getting hit by an uninsured or underinsured motorist can cost you hundreds, even thousands of dollars. But with a little bit of extra insurance, you’ve got protection and peace of mind.
Contact us to learn more!