Uninsured and Underinsured Motorist Coverage: The Basics and Why You Need It

When shopping for auto insurance, it’s safe to say that consumers want to save as much money as possible. With expenses going up for just about everything, millions look to cut costs on their insurance premiums. One way many look to shave dollars on their auto policy by reducing coverage on the uninsured and/or underinsured motorists’ benefit. Depending on where you live, this can be a few hundred dollars a year, so it is an attractive place to trim. However, before changing this coverage it is important to understand how this coverage works.

In this article, I will discuss what uninsured and underinsured motorist coverage is and how it works. Second, I will point out the risks involved when a driver opts out of the coverage. At the conclusion of this article, you should have sufficient information to make an educated decision regarding this option.

Uninsured Motorists Coverage Basics

Uninsured motorist Insurance covers you when you are in an accident caused by another driver who does not have insurance or does not have sufficient insurance to cover the costs associated with the accident. Per DMV.com, uninsured motorists covers things such as medical expenses, lost wages, and pain and suffering from auto accident injuries. Vehicle repairs and damages are also covered if the policy has uninsured motorist property damage. Unfortunately, there are many people who drive without auto insurance. Also, many people who do have auto insurance choose to carry the bare minimum liability limits to save money, or because that is all they can afford. So, having this coverage will prevent you from having to pay for the aforementioned items yourself should you be involved in an accident with a driver that is uninsured or does not have high enough liability limits to cover the damage they have done to you and your family.

Selecting the Right Level of Protection

When picking your levels of coverage for uninsured motorist, it is important to approach it as if you are picking how much you want the insurance company to pay YOU, because in reality YOU ARE. Many people try to cut costs by having higher bodily injury liability limits than uninsured motorist limits. That is unwise because you are in effect valuing complete strangers more than YOURSELF AND YOUR FAMILY. You should have the same limits as your bodily injury. In most cases the difference in price is minimal. A competent insurance professional should recommend this course of action when designing your plan with you. This is especially important if you live in an area with a large number of uninsured drivers, where a hit and run is more likely to occur.

Uninsured motorist coverage is an integral part of a sound insurance policy. Even if you have a liability only policy, paying the extra money is a smart move in protecting yourself and your family. Even in times of economic strain, it should be a certainty that you and your family are worth it. Many years ago, I was a victim of a hit and run and my uninsured motorist provisions got my car fixed. Luckily, I was not in my car when it happened. Unfortunately, that is not the case for so many others. Opting out of this coverage is just too expensive.