According to the Insurance Research Council, about one out of every seven drivers in America is driving as an uninsured motorist. In most cases, if another motorist hits your automobile, his or her insurance pays for the damage. However, if the other party is an uninsured or underinsured motorist (UM/UIM), your basic liability insurance will not cover the crash and can cost you significantly. It can be incredibly frustrating to find yourself strapped with a huge financial burden because another driver was not following driving laws.

Without the right coverage, you may be stuck financially responsible for an accident that was not your fault. Uninsured motorist coverage can be added to most car insurance policies, and some states are even mandating it to provide extra security for properly insured drivers. Even if your state does not require you to have uninsured motorist insurance, it can offer you protection from uninsured drivers and peace of mind.

What is uninsured motorist coverage?

Uninsured motorist coverage is a protection that helps pay for your expenses if you are hit by an uninsured driver. Most accidents where the other driver is at fault will end with his or her auto liability coverage paying for your medical bills or your vehicle repairs.

However, when the other driver is at fault and lacks car insurance, you will need protection from having to pay out of pocket. You should talk to a local agent in order to understand how underinsured and uninsured motorist coverage works in your area.

How does underinsured and uninsured motorist coverage work?

Uninsured motorist insurance covers you in case you are in an accident with an at-fault driver who is driving without liability insurance.

This coverage extends to you and any passengers in your vehicle and can also offer you coverage if you are hit by an uninsured driver as a pedestrian. Depending on the type, uninsured driver coverage can help you pay for medical expenses or vehicle repairs.

Your insurance company can then utilize subrogation in order to sue the uninsured driver on your behalf and attempt to recover some of the expenses.

In other cases, the driver may have auto liability insurance, but either their liability limits aren’t enough to cover your bills or their limits are less than or equal to your underinsured motorist coverage limit.

Without the appropriate coverage in this situation, you may still be stuck with the remaining balance and have to pay for it yourself. In some states, uninsured and underinsured motorist coverages are bundled together and offered as a single protection on your car insurance policy.

What types of uninsured and underinsured motorist coverage are available?

Similar to liability insurance, this coverage is available as either uninsured motorist property damage or bodily injury coverage.

Most states that mandate drivers to have coverage for uninsured and underinsured drivers only require uninsured motorist bodily injury coverage (UMBI). This type of insurance can cover medical expenses, lost wages, and injury-related expenses for drivers, their family members and their passengers.

Anyone who sustains an injury during a hit-and-run accident can also be covered using UMBI. Currently, only 22 states and the District of Columbia have mandatory uninsured motorist insurance requirements.

Bodily Injury Coverage Limits

There are two primary ways that insurance companies set limits for uninsured motorist bodily injury coverage, and it is important to understand the differences between the two. Limits can be considered either:

  • Split limits – Coverage will be handled differently based on whether there is one person injured or if multiple people were injured.
    • An insurer may establish a split limit of $20,000 per person in the case of bodily injury or death.
    • An insurance company can also set up a split limit of $35,000 for the total bodily injuries or deaths per accident.
  • Combined single limits – Your insurance provider will pay out one amount, such as $30,000 for all bodily injuries that occur in an accident.

On the other hand, uninsured motorist property damage coverage will help pay for any repairs to your vehicle after a crash that was the fault of an uninsured driver. It can be incredibly helpful if you are in an accident with an uninsured driver and your vehicle needs repairs.

Since the at-fault driver does not have liability coverage, you will have to cover the cost of repairs. This type of coverage is not mandated by many states, and some states do not even have this type of protection available. Some states that mandate this type of insurance coverage include Maryland, New York and Vermont.

Filing an Uninsured Motorist Coverage Claim

If you’ve been in an accident that is another driver’s fault and they do not have adequate insurance to cover the damages, you will need to file an uninsured motorist coverage claim.

All parties involved in an accident will be informed if the police discover that the at-fault driver does not have liability insurance. In the case of a hit-and-run, take photographs of the scene and try to gather as much information as possible.

Witnesses can greatly increase the chances of your claim being approved, so ask for names, addresses and phone numbers of any potential witnesses.

Claims should be filed as soon as possible because some insurance companies have a limit on the amount of time you can wait before filing an uninsured motorist claim.

Provide your insurance company with all the information that you have. Your claim may be denied if you do not provide enough evidence that you are not at fault for the accident. After the investigation, your company will distribute your reimbursement up to your policy’s maximum coverage.

As your uninsured motorist claim is being settled by the insurance company, you should provide copies and bills from all of the medical care and vehicle repairs that were needed due to the accident. After the investigation, you will receive compensation based on your policy limits and the claims that your insurance provider has deemed valid.

Note: States where you and the other parties share a percentage of the fault for the accident may distribute your reimbursement to reflect the level of fault you hold in the crash.

Last updated on Thursday, October 15 2020.