Should I Invest In Uninsured and Under-insured Motorist Coverage?
Updated: Jul 29
Whether you’re a great driver or not, it’s no secret that every time you get on the road you’re putting yourself at risk of an accident. It’s unavoidable and a risk that quite frankly you probably take every day on your commute to work or elsewhere. If you ever do get in an accident, let’s hope that everyone involved is unharmed and for your sake, you’re not the at-fault driver. But what happens if the at-fault driver doesn’t have enough insurance, any insurance at all, or worse: takes off?
Unfortunately for responsible drivers such as yourself, statistics show that 1 in 8 drivers in the U.S are uninsured. Given the woeful event that you happen to get into an accident with one of these drivers, you can be responsible to pay for the damages caused by the at-fault driver if you do not have uninsured motorist coverage.
Nearly half of the states in the U.S require some form of Uninsured Motorist (UM) or Underinsured Motorist (UIM) coverage. There are 4 different types of protection:
Uninsured Bodily Injury (UMBI)
Uninsured Property Damage (UMPD)
Underinsured Bodily Injury (UIMBI)
Underinsurance Property Damage (UIMPD)
These types of insurance cover property damage, loss of income, medical expenses, pain and suffering, and funeral costs.
States are either “no-fault” or “tort” in terms of insurance. If you live in a no-fault state, you go straight to your insurance company after an accident. If you live in a no-fault state and get in an accident with an uninsured or underinsured motorist, you can just file a claim with your insurance company and they will handle your needs. However, your insurance will not cover loss of income or pain and suffering, so investing in UM/UIM provides you with extra protection.
On the other hand, if you live in a tort state, you would need to go through the stressful litigation process to attempt to recover the damages. Your own insurance will cover you but if the damages exceed your limits you will need to pay out of your pocket or sue for the damages. Which, in this case, it’s a very good idea to have high limits.
In a nutshell, having UM/UIM coverage protects you from unfortunate event where the driver that caused your accident is underinsured or uninsured. Regardless of whether you live in a no-fault or tort state, having UM/UIM coverage gives you essential financial protection.
The simple answer is yes, you should. The average price increase to add uninsured motorist coverage is under 10%, meaning that there is no reason not to.
AZ Insurance Team