Underinsured/Uninsured Motorist Coverage
January 13, 2010
One of the most misunderstood coverage under an auto liability insurance policy is Underinsured/Uninsured Motorist (UM) coverage. Many think they have FULL coverage when they have liability coverage and comprehensive/collision coverage. For clarification, liability coverage insures you if you cause damage to another person or their property. Collision coverage covers your car if you damage your car and you are at fault. Comprehensive covers things such as a tree falling on your car.
UM is a separate coverage you can purchase to protect yourself from at-fault drivers whose insurance limits may be insufficient to cover medical bills and wage loss you may incur in case of an accident. (This coverage can cost as little as 20% more of your annual premium). UM coverage also protects you from at-fault drivers who carry no insurance whatsoever. The number of these drivers on the road is alarming, and it is advisable to take this into consideration when purchasing auto insurance.
Some may ask why they need UM coverage if they have health insurance. Even if one has personal health insurance, the rising cost of health insurance has forced many to substantially raise their deductibles, and co-pay percentage can be very costly as well. UM coverage is an excellent source of insurance to pay these costs should one become involved in an auto accident.
There are two types of UM coverage: “Regular UM” and “Economic-Only UM.” NEVER BUY “ECONOMIC-ONLY” UM COVERAGE! You save a few pennies, but you waive all rights to collect any damages for pain and suffering. Tell your insurance Agent you want “Regular” UM coverage.
The Hunt Law Firm recommends to its clients that they discuss their auto insurance coverage with their insurance agent, in detail, and not make such decisions in haste. Insurance coverage is a serious decision—one that can create serious financial hardships if you do not adequately protect yourself and your family.
