Imagine this scenario: You’re driving home from work when another driver runs a red light and crashes into your car. You’re injured, your car is totaled, and you’re facing thousands of dollars in medical bills. Then you discover the at-fault driver has no insurance. Who’s going to pay for your damages? This is where uninsured motorist coverage becomes your financial lifeline.
What is Uninsured Motorist Coverage?
Uninsured motorist (UM) coverage is insurance that protects you when you’re hit by a driver who doesn’t have auto insurance. Think of it as a backup plan that steps in when the person who caused your accident can’t pay for the damage they’ve done. Even though every state (except New Hampshire) requires drivers to carry auto insurance, millions of people drive without it. According to recent studies, about 1 in every 8 drivers on the road has no insurance at all. In some states, that number is even higher – meaning there’s a significant chance you could encounter an uninsured driver during your lifetime.
How Does Uninsured Motorist Coverage Work?
When you have UM coverage and are hit by an uninsured driver, your own insurance company pays for your damages instead of trying to collect money from someone who has no insurance to begin with. It’s like having your insurance company stand in for the other driver’s missing insurance policy.
Here’s a simple example:
You’re rear-ended by an uninsured driver and as a result, you have medical bills that total $15,000 and car repair costs totaling $8,000. With UM coverage, your insurance company pays these costs (minus any deductible). Without UM coverage, you’d have to pay everything out of your own pocket
What Situations Does It Cover?
Uninsured motorist coverage protects you in several scenarios:
- Hit by an Uninsured Driver: The most common situation – another driver causes an accident but has no insurance.
- Hit-and-Run Accidents: When the at-fault driver flees the scene and cannot be identified, your UM coverage treats it as if they were uninsured.
- Insurance Company Problems: If the other driver’s insurance company goes out of business or refuses to pay a valid claim.
- Underinsured Drivers: Many policies also include “underinsured motorist” coverage, which helps when the at-fault driver has some insurance, but not enough to cover all your damages.
Do You Need Uninsured Motorist Coverage?
The short answer for most people is yes. Here’s why:
It’s More Common Than You Think: With roughly 12% of drivers uninsured nationally (and much higher in some states), the odds of encountering an uninsured driver are significant. Medical Bills Add Up Fast: A single emergency room visit can cost thousands of dollars. If you’re seriously injured, costs can easily reach tens or hundreds of thousands of dollars. Uninsured Drivers Often Can’t Pay: Even if you sue an uninsured driver and win, collecting money from someone who couldn’t afford insurance in the first place is often impossible. It’s Relatively Inexpensive: UM coverage typically costs much less than other types of auto insurance because it’s not covering vehicle damage in most cases – just stepping in for missing liability coverage.
Is It Required?
Requirements vary by state:
Required in these states: About half of all states require you to carry uninsured motorist coverage, including Connecticut, Illinois, Kansas, Maryland, Massachusetts, Minnesota, Missouri, Nebraska, New York, North Carolina, Oregon, South Carolina, Vermont, Virginia, and others.
Optional but offered: In states where it’s not required, insurance companies must usually offer it to you, though you can decline the coverage.
Check your state: Requirements change, so verify what’s required in your specific state.
How Much Coverage Should You Buy?
Most insurance experts recommend carrying UM coverage limits that match your liability coverage. For example, if you have $50,000/$100,000 in liability coverage (meaning $50,000 per person and $100,000 per accident), consider the same limits for uninsured motorist coverage.
Think about it this way: if you believe you need $100,000 in liability coverage to protect others, you probably need that same amount to protect yourself when others don’t have insurance.
What About Your Health Insurance?
You might wonder, “Don’t I already have health insurance?” While health insurance will cover your medical bills, it typically won’t cover: Lost wages, pain and suffering, deductibles and co-pays you have to pay, or vehicle repairs.
Plus, your health insurance company may try to recover their costs from the at-fault party – but if that party is uninsured, there’s nothing to recover, potentially leaving you responsible for repaying your health insurer.
The Bottom Line
Uninsured motorist coverage is one of the most important – and most overlooked – types of auto insurance. It protects you from a risk that’s much more common than most people realize. Given that it’s typically affordable and the financial consequences of going without it can be devastating, most drivers should strongly consider carrying this coverage.
When reviewing your auto insurance policy, ask yourself: “Can I afford to pay tens of thousands of dollars out of pocket if an uninsured driver injures me?” If the answer is no, uninsured motorist coverage isn’t just a good idea – it’s essential protection for you and your family.
Don’t wait until you need it to realize you don’t have it. Talk to your insurance agent about adding uninsured motorist coverage to your policy today.