At a glance
- What it covers
- Pays for your injuries and damage when the at-fault driver has no insurance, or not enough to cover your losses.
- Who needs it
- Every driver. Many states require it, or require you to turn it down in writing.
Why You Need It
All vehicles, in all 50 states, are required to have liability coverage (see separate article on Primary Trucker’s Liability Insurance). Unfortunately some owners ignore the law. Your own insurance will cover you for some things if you are hit by such a driver and that driver is at fault. For example, if your cargo is damaged, your cargo insurance will cover you. One thing that will NOT be covered is any claim you have for personal injuries. If you are seriously injured and cannot work for an extended period of time, and need extensive medical care, this claim could, in an extreme case, run into millions of dollars, and could easily run into hundreds of thousands of dollars.
With uninsured motorist coverage, if you are injured by an uninsured driver you can file a claim against your own insurer and collect up to the limits of your uninsured coverage. Another problem can arise if the other driver has a minimal policy. The minimum legal requirement varies from state to state; in New York it is $25,000; in Florida it is $10,000. Given the cost of medical treatment, and the amount of income you might lose if you are unable to work for an extended period of time, these minimums are almost a joke. With underinsured motorist coverage you can collect up to the limits of your coverage, less whatever you recover from the other driver’s insurer. For example, if you have $1 million in uninsured/underinsured coverage (the limits for the two are always the same), and you are hit by a driver in New York who has a minimum policy, you could collect $25,000 from that driver and then up to $975,000 from your own insurer.
Don’t Count on the Other Guy
Your health, well-being, and livelihood are precious. Don’t count on other drivers having adequate insurance to cover you if they are at fault in a collision. A limit of $1 million is recommended for uninsured/underinsured coverage. If you have an umbrella or excess policy (see umbrella_excess article), you can set your limits even higher.
