What happens if I’m hit by an uninsured or underinsured driver?
A friend of mine was rear-ended a year ago during stop-and-go traffic. The driver-at-fault thought she could change lanes using the fast lane, but had no idea that just 40 feet ahead, my friend's car was deadlocked in traffic.
Despite the deadlock, they managed to pull over to the right side of the freeway and exchange insurance information. The driver-at-fault left immediately maneuvering in and out of traffic. When my friend phoned the insurance claims department, she discovered that the driver-at-fault's policy had been cancelled 4 months prior. Too shaken by the incident, my friend failed to take a photo of the other driver's license.
This essentially had been a hit-and-run situation. The 2 passengers had suffered whiplash and some soreness, but luckily no one was badly injured and the bumper did a really good job absorbing the force coming away with a tiny dent. If this had been worse, my friend may have had to potentially cover the damages out of her own pocket.
This is where underinsured/uninsured motorist coverage would come into play.
Imagine this scenario:
You drive a $125,000 Land Rover Sport. Unfortunately, one day while out headed to Wegmans, another driver accidentally runs a red light and hits your beautiful sports car right behind the passenger side door. Everyone is thankfully okay, but the damage to your car will cost about $70,000 to repair.
The driver at-fault only has the state minimum insurance policy coverage, which covers up to $20,000 in repairs. Where will the additional $50,000 come from to repair your vehicle? Without underinsured motorist coverage (UIM), the $50,000 will come out of your pocket.
What is uninsured/underinsured motorist insurance?
Uninsured/underinsured motorist insurance (UM/UIM) provides you financial protection in the event you are in an accident with a driver who doesn’t have insurance or enough insurance to fully cover the damages.
There are two different types of UIM policies: UIM bodily injury and UIM property damage.
UIM bodily injury insurance is similar to the bodily injury coverage provided in liability insurance. It will provide coverage if the person who caused the accident doesn’t have enough insurance or doesn’t have insurance at all. It will pay for medical bills and other injury related expenses. It will also provide coverage in the case the at-fault driver can’t be identified, i.e. a hit-and-run.
UIM property damage provides coverage for vehicle repairs in case the person who hit you doesn’t have enough insurance or any insurance at all. Unlike UIM bodily injury, UIM property damage won’t provide coverage if the at-fault driver can’t be identified.
Don’t get stuck paying for an accident that wasn’t your fault
Even if you are the best driver in the world and have great insurance coverage, there is always a chance you can get in an accident with an uninsured or underinsured driver.
While it may not happen often, it only takes one accident to suffer the financial consequences of not having uninsured or underinsured motorist insurance.
Talk to your insurance agent and make sure your coverage will provide you with the right protection if you are in an accident with an uninsured or underinsured driver.