Auto Insurance Coverage

Why You Should Have Under-Insured Motorist Coverage


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You may or may not have heard of under insured motorist coverage, but it's something that shows up on a lot of drivers’ policies. So what is it, and what does it mean?

What Is Underinsured Motorist Coverage?

Underinsured motorist coverage is a type of auto insurance that protects drivers from certain kinds of liability. It is a lot like uninsured motorist coverage. Uninsured motorist coverage picks up the tab when an at-fault driver does not have insurance at all. Underinsured motorist coverage pays the difference when an at-fault driver has insurance, but that policy does not provide enough to pay off those who have been impacted by that person's driving in an accident or collision.

What Does Underinsured Motorist Coverage Cover?

The whole point of underinsured motorist coverage is that it is intended to offer full compensation to those who are hurt as a result of someone else's bad driving. That means that underinsured motorist coverage should cover extras like medical costs, lost wages, and more. However, remember that it's in the insurance company's best interests to pay less, so those carrying underinsured motorist coverage should always verify with their insurer that these extras will be covered. Maximum payouts as a result of injury are often called “tort,” and the debate rages over how much should be covered. Talk to your representative about how much compensation you would get in the event of accident. In terms of the vehicle, underinsured motorist coverage policies will also pay to fix damage. Some policies even cover things like rental car reimbursement or other costs of dealing with property damage. The key is to document everything correctly and hold your insurer accountable for the agreement if there is a claim.

Why Get Under-insured Motorist Coverage?

In some states, drivers are required to take out underinsured motorist coverage, so that accident claims don't just keep rolling through the courts. Even if your state does not mandate this kind of coverage, it may be a good idea to take out some underinsured motorist coverage on your policy to make sure you have financial recourse if you are hit by a bad driver. Underinsured motorist coverage protects your assets, and gives you additional peace of mind about what you could encounter on the road. To see why you should take out underinsured motorist coverage, check out your state's minimum liability requirements and balance that against the realistic costs of a collision.

If you're involved in an accident with an uninsured driver, uninsured motorist insurance will provide reliable protection by paying for your car repairs, medical bills and expenses. Before you start shopping for uninsured motorist insurance, you should check your current car insurance policy to make sure that you don't already have uninsured motorist coverage. Many states require uninsured motorist insurance be a part of your insurance coverage policy. So if you live in a state that requires it, your policy probably already includes uninsured motorist coverage.

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