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What is Underinsured Motorist Coverage?

by Autobytel Staff
May 20, 2011

Many people get confused by the differences between uninsured and underinsured motorist coverage. Both plans cover you in the case of an accident where the other driver is at fault and can cover damage to your car, medical expenses for you and your passengers, possibly your property in the car, lost wages due to injury and even pain and suffering.

What Is Underinsured Motorist Insurance

Underinsured motorist insurance is a very smart buy as it protects you from the financial burden of having an accident with a driver who may have had the best intentions in keeping their vehicle insured within the parameters of the law but could only afford the least amount of coverage allowed. Everyone’s financial state is different and it’s easy to be seduced by the low monthly premium afforded by minimal amounts of car insurance. Be smart and protect yourself against other people’s possibly ill-advised decision making by getting underinsured motorist insurance.

It is highly recommended that you carry both uninsured and underinsured motorist insurance coverage given the fact that it is estimated that 25% of driver’s have no car insurance and the number of drivers who don’t carry enough coverage for most accident situations is even higher. Most states require that drivers carry a minimum amount of liability car insurance coverage but in many cases that amount is not enough to cover the damage to the other driver’s car and underinsured motorist insurance can protect you.

What Underinsured Motorist Insurance Covers

In case you do have an accident where the damage to your car, medical expenses and resulting loss of income is greater than what the party at fault’s insurance coverage will pay for, your underinsured motorist insurance plan will come in to cover the gap in costs. In the event of a very serious accident where you wind up having astronomical medical expenses, underinsured motorist coverage could save you and your family from the possibility of financial ruin.

If a person can’t afford to properly insure their car to a level that will protect against a serious accident then it is doubtful that they have enough money to ever make it worthwhile to sue them at a later date for damages. The cost of an attorney and bringing a lawsuit against an underinsured driver to get back the costs affiliated with fixing your car and covering your medical expenses rarely results in a settlement that will put your financial state back in order. Underinsured motorist coverage will assist with covering these expenses.

Why You Should Have Underinsured Motorist Insurance

There are many people out there who are out of work and suffering financially and often, the first thing to get cut back in a family budget is the level of car insurance coverage. While you may see the shortsightedness of this decision, keeping a roof over your head and food on the table does take precedence with most people.

Adding underinsured motorist insurance coverage is relatively inexpensive to boost your insurance coverage and can be a real life saver considering how financially devastating a car accident can be to any person or family. It’s just a sad fact that most states don’t require that drivers carry enough insurance coverage to pay for the costs attributable to serious collisions.

You never want to think about what would happen to you or family in the event of a collision with another car but if you don’t buy underinsured motorist coverage, such an event could put affect your finances to such a degree that it could affect your ability to work and pay for other life essentials like your mortgage and grocery bills. With underinsured motorist insurance coverage, you can easily take that worry off of your mind.


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