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
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
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.