Do I need uninsured motorist coverage?
Not all states mandate uninsured motorist coverage, also known as UM coverage. However, even if UM coverage isn’t required in your state, you’re taking a serious risk if you drive without it. According to the Insurance Information Institute, about 13% of drivers countrywide don’t have auto insurance. In some states, the number of uninsured drivers is over 20%.
If you’re injured or your vehicle is damaged in an accident with an uninsured or underinsured driver, you could end up paying for medical bills or vehicle repairs out of your own pocket. Even if you file a claim against your own policy, you may have a large collision deductible or not have enough medical payments/personal injury protection to cover injuries caused to you or your passengers.
What does uninsured motorist insurance cover?
Uninsured/underinsured motorist insurance covers your injuries, your passengers’ injuries, and damage to your vehicle if you’re hit by a driver with not enough or no auto insurance coverage. Depending on your state, uninsured/underinsured motorist insurance may be separate, combined, or consist of up to four coverages:
If you’re hit by a driver with no insurance…
- Uninsured motorist bodily injury (UMBI) pays medical bills for both you and your passengers
- Uninsured motorist property damage (UMPD) pays for damage to your vehicle
If you’re hit by a driver with not enough insurance…
- Underinsured motorist bodily injury (UIMBI) pays medical bills for both you and your passengers
- Underinsured motorist property damage (UIMPD) pays for damage to your vehicle
Does uninsured motorist insurance cover hit-and-run accidents?
Yes. If a driver hits your vehicle and flees, you can file a claim against your policy’s uninsured motorist coverage.
Do I really need uninsured motorist bodily injury coverage if I have 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.
How much uninsured motorist coverage do I need?
You 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 give you no other option but to choose identical limits.
Your UMPD limit is a different (and much easier) story. You can select a limit that closely mirrors the value of your vehicle. If your car is worth $20,000, and you don’t carry collision coverage, then you should consider that much in UMPD coverage.