No one wants to have a car accident, but accidents can happen to anyone, so we protect ourselves and others with automobile liability insurance. One aspect of auto insurance you may wonder about is “uninsured or underinsured motorist coverage.” Since most states require every driver to be insured, is this coverage really necessary?

Unfortunately, some drivers ignore the law and drive without insurance. Others carry only the minimum required, and that may not be enough to pay for damage to expensive vehicles, or to cover the costs of injuries to you or your passengers. This type of insurance coverage should also protect you if the other driver is at fault but his insurance company refuses to pay your legitimate claim.

Another scenario where this coverage is used is in a hit-and-run accident. According to the National Highway Traffic Safety Administration, one out of eight automobile accidents is a hit-and-run accident. Although hit-and-run accidents are more likely to cause only collision damage, you would still be left with a damaged vehicle and without the option of receiving payment from the other driver’s insurance company.

If you drive a vehicle valued at $50,000, for example, and you are hit by a driver whose insurance provides coverage up to $25,000 in damages, your uninsured or underinsured motorist coverage would cover the difference, up to the limits of liability in your policy. You could also be the victim of a hit-and-run accident, where there would be no coverage other than your own policy.

If there are injuries involved, costs can mount quickly, and if the other driver is uninsured or underinsured, his policy will not cover all of the costs. Additionally, you may have health insurance to cover your own medical costs if you are injured, but a passenger riding in your car may not have health insurance. The uninsured or underinsured coverage that you carry will at least provide basic care for those passengers.

The uninsured or underinsured coverage does not replace collision or personal injury coverage, but can be an important supplement to protect you from negligent drivers. Each state has different laws governing automobile insurance, and each insurance company offers differing coverage. It is important to discuss your particular needs with a knowledgeable insurance agent in order to determine what is best for you and your family.