What does uninsured motorist insurance cover?
Uninsured/underinsured motorist insurance covers damages to your car and your/your passengers' injuries if an uninsured (or underinsured) driver hits you AND is at fault. There is typically no deductible for your medical bills but one often applies for damages to your car.
Depending on your state, uninsured/underinsured motorist insurance may be separate, combined together, or consist of up to four coverages:
Uninsured motorist bodily injury (UMBI): Pays for your/your passengers' medical bills and injuries if you’re hit by a driver with no insurance.
Underinsured motorist bodily injury (UIMBI): Pays for your/your passengers' medical bills and injuries if you’re hit by a driver with not enough insurance.
Uninsured motorist property damage (UMPD): Pays for damage to your vehicle if you’re hit by a driver with no insurance.
Underinsured motorist property damage (UIMPD): Pays for damage to your vehicle if you’re hit by a driver with not enough insurance.
Should I add uninsured motorist coverage and how should I choose the right limits?
In many states, this coverage is optional, but remember that about 13% of drivers don’t have insurance. You’ll usually have the option of choosing the dollar limits of your coverage. For the bodily injury portion that covers your injuries, consider matching the amount of your liability coverage. Some states will give you no other option but to choose identical limits.
For example, if your limits of liability are $50,000 per person/$100,000 per accident, consider choosing the same limits for UMBI and UIMBI. If you’re hit by an uninsured driver, each injured passenger(including the driver) can collect up to $50,000. If two passengers collect the full $50,000, then you’ve reached your $100,000 maximum per accident.
Your UMPD limit is a different (and much easier) story. This is the part that covers your car. You can select a limit that closely mirrors the value of your vehicle. If your car is worth $25,000, and you don’t have collision coverage, then you should consider that much in UMPD coverage.
The safe choice is a higher amount: 74% of our drivers choose more than their state’s minimum limits.
Uninsured motorist bodily injury vs. health insurance
Your health insurance may overlap with UMBI and UIMBI coverage. In states where UMBI and UIMBI are optional, there are a few things to consider before passing on the coverages:
- Will your health insurance cover injuries sustained in an auto accident? Medicare and Medicaid may not pay out until other sources of insurance have been exhausted. If you have private health insurance, check with your health insurer to find out how medical expenses resulting from a car accident are covered.
- Does your health insurance have a deductible? Generally, there’s no deductible with UMBI and UIMBI. If you have a deductible with your health insurance, and it’s high, it may be beneficial to carry UMBI and UIMBI.
- Will there be passengers in your car that don’t have their own health insurance? Your UMBI and UIMBI coverage will protect those passengers.
- Does your health insurance cover lost wages? Your UMBI and UIMBI sometimes will, as well as other areas not protected under some health insurance plans.
Uninsured motorist property damage vs. collision coverage
Don’t be alarmed if you’re checking your policy and notice that you have no coverage for UMPD—that’s probably because you already carry collision coverage. Collision covers damage to your car in any scenario, even if the other driver in the accident is uninsured. So, if UMPD isn’t required in your state, there’s no point in adding both since you’d then be paying to protect your car twice.
Maybe you have an older, paid-off vehicle and prefer not to carry collision. In that case, you may want to think about carrying UMPD. It’s generally inexpensive, as low as only a few dollars a month. And you’ll have peace of mind knowing your car is covered up to your policy’s limits if you’re hit by one of the millions of drivers on the road without auto insurance.