Uninsured motorist coverage is a type of auto insurance designed to protect drivers and passengers financially in the event of an accident where the at-fault party does not have auto insurance.
This coverage is an important aspect of auto insurance policies, offering a safety net in scenarios where the responsible party cannot cover the costs associated with damages or injuries due to lack of insurance.
You can safeguard yourself and your passengers financially against drivers who do not have insurance by adding uninsured motorist coverage to your car insurance policy.
This endorsement covers your injuries or any damage to your vehicle, and covers hit-and-runs (see US Auto Insurance Rates by States in 2024).
Considering that about 14% of drivers across the country don’t have insurance (a figure that’s even higher in certain states), having this coverage can save you from incurring substantial costs in the event of an accident.
Uninsured motorist coverage is a part of your minimum coverage requirements, so there is a chance you already have it on your policy.
Without uninsured motorist coverage, you could be forced to pay for your medical bills and vehicle repairs if the at-fault driver is unable to do so.
Uninsured motorist coverage typically comes in two types: Bodily Injury (UMBI), which covers medical costs, and Property Damage (UMPD), which pays for car repairs. The exact coverage can vary depending on the state, so it’s crucial to review your policy or speak with your insurance provider.
Uninsured motorist coverage is often lumped with underinsured motorist coverage, but they are two different types of coverage.
While uninsured motorist coverage is for accidents where the at-fault driver does not have an active auto insurance policy, underinsured motorist coverage will cover you if a driver hits you but doesn’t have enough car insurance to pay for your damages.
How Uninsured Motorist Coverage Works?
Uninsured motorist coverage typically includes two components:
- Uninsured Motorist Bodily Injury (UMBI): This part of the coverage pays for medical expenses, pain and suffering, lost wages, and other injury-related expenses for you and your passengers if injured in an accident caused by an uninsured driver. It can also provide coverage in hit-and-run incidents, depending on the jurisdiction.
- Uninsured Motorist Property Damage (UMPD): This covers the damage to your vehicle or property if an uninsured driver hits your car. In some places, UMPD also covers hit-and-run accidents, but in others, collision coverage may be required to cover vehicle damage in these situations.
Insurance Coverage Limits
Uninsured motorist coverage comes with limits, which are the maximum amounts your insurance company will pay in the event of a claim.
These limits are set in your policy and can vary depending on your preferences and the requirements of the state in which you reside. Some states require drivers to have uninsured motorist coverage, while in others, it’s optional.
How It Activates?
If you’re involved in an accident with an uninsured driver who is at fault, you would file a claim with your own insurance company under the uninsured motorist portion of your policy. Your insurer would then assess the claim to cover damages or injuries up to the limits specified in your policy. This process typically involves providing evidence of the accident, such as a police report, and documentation of your injuries and damages.
Benefits
The main benefit of uninsured motorist insurance coverage is financial protection. It ensures that you and your passengers have access to funds for medical treatment and repairs to your vehicle, even when the at-fault driver lacks the necessary insurance to cover these costs. This can be especially valuable in jurisdictions with high rates of uninsured drivers.
Considerations
When choosing uninsured motorist coverage, consider the insurance requirements in your state and evaluate your personal risk tolerance.
In areas with a high rate of uninsured drivers, having this coverage can offer peace of mind and significant financial protection in the event of an accident.
It’s also worth comparing the cost of adding uninsured motorist coverage to your policy against the potential out-of-pocket expenses you might face without it.
Uninsured motorist coverage is a critical component of auto insurance that safeguards policyholders from the financial repercussions of accidents involving uninsured drivers. By understanding how this coverage works and ensuring adequate protection, drivers can better protect themselves and their passengers from unforeseen expenses arising from such incidents.
Author: Nataly Kramer
