Underinsured Motorist Coverage

What happens when there is an auto accident with someone who does not have insurance? While it is required to keep insurance coverage on a vehicle, there are a lot of people who would rather just take their chances without it. According to the Insurance Research Council, approximately 14% of people are driving without insurance or with insufficient coverage. In some states that percentage reaches over 20%.

So what happens if there is an automobile accident and one of the drivers has no coverage? For starters, the other driver could be liable to pay thousands of dollars in damages to his car, regardless of who is at fault. This is where uninsured and underinsured motorist coverage comes in so handy. If this is purchased, a deductible may still apply, but the car will be covered for repairs and even damage to valuables that were in the car at the time of the accident. Typically this coverage ranges from 6% to 9% of the total vehicle policy premium. This is a lot of benefit for not a whole lot of cost.

For example, “if a minivan smashes into your brand new SUV, causing $33,000 in damages, and the other driver’s insurance provides a maximum of $25,000 per vehicle for property damage, you could be stuck with the remaining $8,000 to repair your vehicle. Underinsured motorists coverage fills the gap if the at-fault driver’s policy limits are not adequate to cover your damages.”

Sit down with an insurance agent and talk about options. Make sure that the insurance coverage that you have is enough to protect you in the event of an accident. Don’t let someone else’s failure to prepare constitute an emergency on your part.