Insurance Curator 
Introduction:
Picture this: you’re driving down the highway, minding your own business, when suddenly another car comes out of nowhere and smashes into you. You’re okay, but your car is totaled. The other driver apologizes profusely, but then drops a bombshell – they don’t have insurance. What do you do now?
This is where uninsured and underinsured motorist coverage comes in. It’s a type of insurance that protects you in situations like this, where the at-fault driver either doesn’t have insurance or doesn’t have enough to cover the damages. In this article, we’ll explore why this coverage is so important and how it can save you from financial disaster.
The Basics of Uninsured and Underinsured Motorist Coverage
Uninsured motorist coverage (UM) and underinsured motorist coverage (UIM) are two separate types of insurance that can be added to your auto policy. UM protects you if you’re in an accident with a driver who has no insurance, while UIM kicks in if the other driver’s insurance isn’t enough to cover the damages.
In many states, UM and UIM coverage is optional, but it’s a good idea to have it anyway. Why? Because according to the Insurance Research Council, one in eight drivers on the road is uninsured. That’s a lot of potential accidents waiting to happen.
Real-World Examples
Let’s look at a real-world example of how UM and UIM coverage can save the day. Sarah was driving home from work when she was hit by a driver who ran a red light. The other driver didn’t have insurance, and Sarah’s car was totaled. Thankfully, she had UM coverage, which paid for the damages to her car and her medical bills.
In another case, John was hit by a driver who had insurance, but not enough to cover the damages to his car. John’s UIM coverage kicked in and covered the difference, saving him from having to pay out of pocket.
The Financial Impact
Without UM and UIM coverage, you could be on the hook for thousands of dollars in damages and medical bills if you’re in an accident with an uninsured or underinsured driver. This could mean dipping into your savings, taking out loans, or even declaring bankruptcy.
On the other hand, UM and UIM coverage is relatively inexpensive. According to the Insurance Information Institute, the average cost of UM coverage is just $50-$75 per year. That’s a small price to pay for peace of mind.
The Legal Side
In some states, UM and UIM coverage is required by law. For example, in Maine, drivers must have at least $50,000 in UM coverage. In other states, like California, it’s optional but highly recommended.
It’s also worth noting that if you’re in an accident with an uninsured or underinsured driver, you may be able to sue them for damages. However, this can be a long and costly process, and there’s no guarantee you’ll win.
Conclusion
Uninsured and underinsured motorist coverage may seem like just another expense on your auto insurance bill, but it’s an important one. It protects you from the financial fallout of an accident with an uninsured or underinsured driver, which is more common than you might think.
So next time you’re reviewing your auto insurance policy, make sure you have UM and UIM coverage. It could be the difference between a minor inconvenience and a major financial disaster. And remember – it’s always better to be safe than sorry.
