The Skinny on Uninsured Motorist Coverage
There are just too many uninsured or underinsured drivers in the U.S. today. Automobile owners somehow feel that they do not really need this additional coverage for whatever reason. The fact is nearly half of the vehicular accidents taking place these days usually have one uninsured motorist driving an unreliable vehicle. You would do well to protect yourself from this unwanted circumstance.
The uninsured motorist coverage is an optional rider to an automotive insurance policy. This particular insurance product will compensate your loss which was caused by an uninsured driver. Most U.S. states require insurance companies to make this coverage part of the comprehensive vehicle insurance policy. If a motorist would not like this particular coverage, he or she would have to decline it formally through a written request. This coverage is signified by the letters “UM” or “U” on the policy.
Who Is Insured?
When you buy uninsured motorist coverage it will provide protection not only for you but for every member of your household. The coverage will also extend to your minor children who are not living with you or those who are attending college in another city. You do not need to be driving a vehicle or riding in one for the policy to take effect. Uninsured motorist coverage will apply under any situation where an uninsured driver causes you injury. The policy will cover your passengers at the moment of the accident caused by an uninsured motorist. Furthermore, the policy will cover not only your medical expenses but your lost income, pain, and suffering.
When Will the Coverage Take Effect?
The policy kicks in when the insured figures in a vehicular accident where the other driver is uninsured. It can also take effect under a situation where you figure in a hit-and-run accident but only as far as your injuries are concerned. It will not pay for the damage sustained by your vehicle. Also, the coverage will only apply if the liability limits of the other driver are below your limits for uninsured coverage. To illustrate, if the other driver has liability coverage of about $50,000.00 and your uninsured motorist policy has the same amount, then you will not be entitled to the benefits. However if your uninsured coverage is $100,000, then you are entitled for up to $50,000 benefits from your insurer and times the number of injured passengers riding with you.
What are the Losses Covered?
Your uninsured motorist policy will compensate you for financial and non-financial losses sustained as the result of the uninsured driver’s negligence. Financial losses entail medical expenses, lost earnings, or any untoward changes to your ability to work and earn money. It will also entail out-of-pocket expenses you had to shell out like getting a private nurse or sitters for your children.
The non-financial damages pertain to circumstances like pain and suffering or the loss of capability to engage in your normal activities due to the injuries, as well as all other losses where you would be entitled to compensation based on the law. There isn’t a hard and fast rule for computing the compensation for some of the circumstances covered by the policy. But the representatives of the parties are usually able to resolve the issue taking into account the degree of the injury.
Your insurer would typically offer a minimum of $30,000 per person and $60,000 aggregate, even if you purchase a higher amount of liability coverage. Your uninsured coverage will follow the amount of your liability policy if said policy is lower than $30,000. You have to keep in mind that a $30,000 limit of uninsured motorist coverage is issued automatically even if you have higher liability limits. You want to clarify this with your insurer if you want your uninsured motorist coverage to match your liability limits.
How Much Do You Need?
Only you can determine how much uninsured motorist coverage you will need but as an unspoken rule, it should match your liability coverage. If you hold a high-power job and being away from work due to injury would greatly impair your ability to earn your income, then you need substantial protection from uninsured motorists. Most motorists who purchase this coverage typically start at $100,000 per person and $300,000 aggregate, anything less could just be too risky.