Understanding uninsured/underinsured motorist coverage

Key takeaways

• Underinsured motorist coverage comes in handy if the driver at fault in an accident doesn't have enough insurance to pay for your expenses.
• Uninsured motorist coverage protects you if you get into an accident with a driver who doesn't have any insurance at all.
• If required in your state, there are laws about how much underinsured and uninsured motorist coverage you need to have.

What is uninsured and underinsured motorist coverage?

Uninsured and underinsured motorist coverage are important parts of many car insurance policies. This insurance helps cover your costs if you're in an accident and the driver at fault either doesn't have insurance or doesn't have enough coverage to pay for the damages.

Here are two examples of how these coverages work:

How uninsured motorist coverage works

Emily is driving home from work when another driver runs a stop sign and crashes into her car. Not only is Emily's car damaged, but she also gets seriously hurt and must go to the hospital. Unfortunately, the driver who hit her has no insurance, leaving Emily with a lot of medical and repair bills.

Luckily, Emily had uninsured motorist coverage, which helped pay for her medical expenses and car repairs. Without this coverage, Emily would have to pay for everything herself, even though the accident wasn't her fault.

How underinsured motorist coverage works

While coming home from school, Martin is hit from behind by a driver who is going too fast and fails to stop in time. In addition to the damage to his car, Martin continues to suffer from severe neck and back pain. While undergoing weeks of medical treatments and physical therapy, Martin is unable to work. And while the at-fault driver had insurance, she only carried the state's minimum coverage which does not fully cover Martin's medical bills, vehicle repairs, and lost wages.

Thankfully, Martin's auto insurance included underinsured motorist coverage, which covered the remaining costs that the at-fault driver's insurance couldn't. Without this coverage, Martin would have been responsible for his medical and auto expenses while also losing income during his recovery.

What does it mean to be underinsured in insurance?

Being underinsured in auto insurance means you don't have enough coverage to fully pay for expenses if you're in an accident.

What's the difference between underinsured and uninsured insurance?

Uninsured motorist coverage helps when the driver who caused the accident has no insurance at all. Underinsured motorist coverage helps when the driver has insurance, but it's not enough to cover your costs.

What happens if I'm in an accident with an uninsured driver and I don't have uninsured car insurance coverage?

If you get into an accident with a driver who has no insurance and you don't have uninsured motorist coverage, you will have to pay for your own costs, like car repairs and medical bills. Even if you have health insurance or collision coverage, you'll still have to pay for deductibles and co-pays out of your own pocket.

How does uninsured motorist coverage protect me from hit-and-run accidents?

Uninsured motorist coverage helps you if you're in a hit-and-run accident where the other driver leaves before you can get their information. If that happens, this coverage will pay for your medical bills, lost wages, and, in some states, car repair costs. Basically, since the driver who ran away is often never found, this coverage acts like the driver didn't have any insurance at all.

What should I do immediately after an accident with an uninsured driver?

If you have an accident with a driver who has no insurance, follow these steps:

• Turn on your hazard lights and, if it's safe, move your car out of traffic.
• Call the police to properly report the situation.
• Get the other driver's information, like their name, contact details, and a description of their car.
• Take pictures of the accident scene, including both vehicles and the area around them.
• If there are witnesses, collect their names and contact information.
• Report the accident to your auto insurance company.
• Check with your insurance company to see what help you can get for an uninsured driver.

How do state laws affect the amount of uninsured and underinsured motorist coverage I should carry?

Your state's car insurance laws tell you how much uninsured and underinsured motorist coverage you must have in your car insurance. The minimum amounts can be different depending on where you live, so it's important to know what's required in your state. Even if your state doesn't require these coverages, they still offer helpful protection.

Get a car insurance quote in under 10 minutes to see how much you could save when you only pay for what you need.