Uninsured Motorist Coverage: Your Protection From Unprotected Motorists

What happens if the driver who struck you does not have sufficient liability insurance? Worse yet, what if he flees before you can obtain his information? Uninsured motorist coverage financially safeguards you in the event of an accident caused by an irresponsible driver.

What would happen if you were the victim of a hit-and-run or if you were the victim of a car accident caused by someone who did not have insurance? If you are involved in an accident with an uninsured motorist, you will be on the hook for the costs of vehicle repairs and medical expenditures.

According to the Insurance Research Council research published in 2021, around one in every eight drivers does not have auto insurance. How will you be compensated if you are wounded in a car accident caused by a driver who did not have car insurance? There is a possibility that you will incur significant out-of-pocket expenses, such as medical bills and health insurance deductibles.

If your injuries cause you to miss work, you may be deprived of valuable pay while you recover.

Fortunately, several forms of auto insurance coverage can help to alleviate this problem: Uninsured motorist coverage and underinsured motorist coverage pay for medical bills and other expenses incurred by you and your passengers if you are involved in a car accident that is caused by one of the following factors:

  • A driver who does not have any form of liability automobile insurance.
  • A driver who does not have sufficient liability insurance to pay your medical expenses.
  • A driver whose insurance company either denies coverage or goes out of business is referred to as a “denied coverage” driver.

The following expenses can be covered by uninsured motorist coverage:

  • Bills for medical care
  • If you cannot work as a result of a car accident, your payment will be forfeited.
  • Compensation for physical and mental anguish
  • Expenses for a funeral
  • Car damage, often called uninsured motorist property damage coverage, is available in some states.

Some states require uninsured motorist coverage, while others require your insurance provider to give you the policy, which you can normally refuse in writing if you don’t want it. Uninsured motorist coverage is required in some states, but not all. If uninsured motorist coverage is optional in your state, it’s worth considering because it’s usually a beneficial policy to have.

Please continue reading to learn more about what uninsured motorist coverage entails and whether or not it would be a smart idea to have it in your auto insurance policy.

What is uninsured motorist coverage?

If you are hit by a driver who does not have insurance, you could be on the line for significant medical and repair expenses – unless you have uninsured motorist coverage.

Uninsured motorist insurance protects you from having to pay out of pocket for injuries or property damage caused by accidents that you did not cause yourself. Uninsured motorist coverage is an optional addition to a normal auto insurance policy that pays for injuries to the policyholder and his or her passengers, as well as damage to property if the other driver is legally responsible for the accident but does not have liability insurance.

Uninsured motorist coverage is required by law in some states, but it is also available in other jurisdictions.

Uninsured motorist vs. underinsured motorist coverage

Drivers who have some insurance but not enough to cover the full cost of a claim, such as those who are uninsured, are another type of motorist to watch out for. Once again, most jurisdictions require drivers to maintain a minimum amount of liability insurance coverage at all times. When it comes to auto insurance, however, a driver who is looking to save money may choose the cheapest coverage options available, which may result in financial ramifications for other drivers if they are involved in an accident.

As a result, it is critical to understand the difference between uninsured motorist coverage and underinsured motorist coverage. Underinsured motorist coverage would cover a situation in which the at-fault driver did not have enough insurance to fully cover the damages suffered by the other injured party. These two types of coverage, on the other hand, can be combined together. In most cases, they are a reasonably modest add-on to an auto insurance policy that provides valuable coverage. They can be purchased singly or in combination.

How does uninsured motorist coverage work?

In the case of an uninsured motorist (UM), the at-fault driver does not have auto insurance, does not have insurance that satisfies the state’s required minimum liability amounts, or whose insurance company refuses or is unable to pay the claim. As well as being uninsured, a hit-and-run driver would be considered to be uninsured. Unless you have uninsured motorist coverage, if you are involved in an accident with an uninsured motorist and do not have uninsured motorist coverage, you may be unable to get compensation, even if the other party is at fault.

State laws generally require motorists to carry some level of automobile liability insurance coverage, with the amount of coverage required varying from one jurisdiction to the next. Policyholders in 19 states, as well as the District of Columbia, must have uninsured motorist coverage. New Hampshire and Virginia are the only two states in the United States that do not mandate a certain level of auto insurance coverage.

According to the Insurance Research Council, one out of every eight drivers on the road in the United States does not have insurance, despite these laws. According to the organization’s most recent research on the subject, Florida had the greatest percentage of uninsured drivers, at 26.7 percent. The state was followed by Mississippi, New Mexico, Michigan, and Tennessee, in that order. Maine has the lowest percentage of uninsured motorists, at 4.5 percent, making it the least dangerous state.

You may be entitled to financial compensation if you are involved in an accident in which the other driver does not have adequate insurance. Uninsured motorist coverage is designed to protect you against financial losses resulting from an accident in which the other driver does not have adequate coverage. Suppose you are involved in an accident, and the other motorist is to blame. In that case, you would submit a claim with the insurance company of the other driver. If your claim is successful, you may be able to use the profits to repair your automobile or pay for medical expenditures linked with injuries sustained in the car accident.

A policy that provides uninsured motorist coverage can reduce the amount of money you may have to pay toward vehicle repairs or medical bills in the event that the other driver does not have enough coverage or no insurance at all. Although this may be optional depending on where you live, having this insurance can provide some reassurance if you are involved in an accident, as previously stated.

Types of uninsured motorist coverage

When it comes to uninsured motorist coverage, there are four primary types to consider:

Underinsured motorist bodily injury

In the event that another driver causes a car accident but does not have enough liability insurance to cover all of your medical bills, lost earnings, and other expenses, underinsured motorist bodily injury (UIM or UIMBI) insurance will pay.

Underinsured motorist property damage

Underinsured motorist property damage (UIMPD) insurance protects you if your automobile is damaged by a driver who does not have enough liability insurance to pay the damage.

Uninsured motorist coverage limits

Uninsured motorist coverage is typically expressed as a ratio of two numbers, for example, 100/300. This translates as follows:

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  • Per person, $100,000 bodily injury coverage.
  • Per accident, $300,000 bodily injury coverage.

Therefore, if you have 100/300 and four passengers who get serious injuries, your maximum uninsured motorist payment is $300,000. However, if your uninsured motorist coverage expires, you may normally rely on health insurance.

Uninsured motorist coverage deductible

Uninsured motorist bodily injury coverage does not normally have a deductible; however, uninsured motorist property damage policy does have a deductible.

How does an uninsured motorist claim payout work?

It’s vital to understand how uninsured motorist claims normally work in order to avoid being surprised if you receive less than expected. The amount of underinsured motorist coverage you can claim is often lowered by the amount of money you receive from the liability insurance of another driver. Here is an illustration:

Assume you have $100,000 in uninsured motorist coverage and $50,000 in liability insurance from the other driver, and your total medical expenditures are $300,000. Your uninsured motorist policy is likely to pay you only $50,000 ($100,000 UM – $50,000 at-fault driver’s liability), leaving you out of pocket for $200,000 in damages. Generally, you do not receive your entire uninsured motorist coverage ($100,000) in addition to the driver’s liability coverage ($50,000). In this case, you may anticipate receiving $150,000 in total from insurance but receive just $100,000.

Certain states, such as Connecticut, make exceptions. Connecticut drivers can purchase uninsured motorist “conversion” coverage, which means their uninsured motorist benefits will not be lowered by the liability insurance of the at-fault motorist. In the event described above, a driver with conversion coverage would receive the full amount of their uninsured motorist ($100,000) plus the other driver’s liability payout ($50,000), for a total of $150,000.

Georgia, for example, provides you with a choice. Georgia drivers have the option of purchasing “uninsured motorist coverage—in addition to their at-fault liability limits.” You may opt-out of this coverage in writing and choose “uninsured motorist coverage—reduced by at-fault liability limits.”

How do I make an uninsured motorist coverage claim?

If the at-fault driver does not have insurance while the accident is being investigated, the police will notify the other drivers who were involved in the accident. If the police do not arrive at the scene of the accident or, in the instance of a hit-and-run, attempt to obtain as much information as you can about what happened. Inquire about the names, addresses, and phone numbers of any possible witnesses. Try to collect the license plate number of the other vehicle and snap images of the accident area if at all possible.

Declare your insurance policy void as soon as possible and include all of the facts you have at your disposal in your claim submission. If you have an uninsured motorist claim, some insurance companies will have a time limit on how long you can wait before filing your claim. These restrictions will differ from company to firm.

As part of the claim settlement process, the insurance company will require copies and billings for all medical care obtained as well as any automobile repairs that were necessary as a result of the incident. If the insurance provider determines that the costs provided with the claim are either unnecessary or unrelated to the accident, the sums submitted with the claim will be denied. It is common for a policyholder who disagrees with the judgment of an insurance company to bring their case before a binding arbitration panel.

Examples

  1. You’re stopped at a red light and are rear-ended by an uninsured driver. Because the at-fault motorist is not insured, you must submit an uninsured motorist coverage claim with your auto insurance provider. You will file a claim for medical expenses under your uninsured motorist bodily injury (UMBI) policy and for vehicle damage under your uninsured motorist property damage (UMPD) coverage if you have it.
  2. As a pedestrian in a crosswalk, you are struck by a car that lacks sufficient liability insurance to cover all of your medical expenses. To begin, file a claim with the at-fault motorist’s auto insurance carrier or sue the driver to obtain compensation from their liability insurance. Then you would file a claim with your own car insurance provider for additional charges under your underinsured motorist bodily injury (UIMBI) policy.
  3. Your vehicle is currently parked in a public garage. You discover it has been struck and damaged, but the other driver has left no contact information. You would make a claim under your UMPD coverage in this hit-and-run situation (if your state allows it). If you do not have UMPD or your state prohibits you from using it for hit-and-runs, file a claim under your collision coverage.

How much uninsured motorist coverage do I need?

If your state mandates uninsured motorist coverage, you must purchase at least the bare minimum while obtaining auto insurance rates. Typically, the bare minimum will be uninsured motorist coverage in an amount equal to your liability coverage.

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For instance, if your liability limits are $100,000 for personal injury and $300,000 for injuries sustained in a single accident, you would purchase 100/300 in uninsured motorist coverage.

Is uninsured motorist coverage necessary?

In the event that your state does not mandate uninsured motorist coverage, you may be asking whether you should include it in your vehicle insurance policy.

Here are some suggestions for making a decision:

Do you have any other types of insurance to cover the costs of vehicle accident injuries?

The primary purpose of uninsured motorist coverage is to reimburse you for medical expenses incurred as a result of an automobile accident caused by an uninsured driver. If you have comprehensive health insurance, you may not believe you require uninsured motorist coverage. However, if you have a high deductible health plan and would be required to pay a significant sum of money in the event of a hospitalization, uninsured motorist coverage may be an interesting option.

Uninsured motorist coverage (uninsured motorist) allows you to cover vehicle accident injuries without having to pay co-insurance, copays, or health insurance deductibles. Uninsured motorist coverage also provides benefits that are not covered by health insurance, such as compensation for pain and suffering and lost wages.

According to the most current statistics from the National Association of Insurance Commissioners, the average claim payment for uninsured motorist coverage for injuries is $29,825.

Do you have any other types of insurance that will cover car damage?

It is possible that you will not require uninsured motorist property damage coverage in states where it is available. Collision insurance will also cover damage to your vehicle if it is struck by another vehicle, and it will cover a wide range of situations, not just those involving an uninsured driver.

Is there a significant number of uninsured drivers in your state? According to the Insurance Research Council, approximately one in every eight drivers in the United States is uninsured; however, there is significant variation between states. Mississippi has the highest rate of uninsured motorists (29.4%), while New Jersey has the lowest rate(3.1%).

Are hit-and-run accidents covered by uninsured motorist coverage?

When a car accident occurs, a hit-and-run is commonly characterized as one in which the motorist flees the scene without exchanging insurance or contact information with the other parties involved. A hit-and-run can occur between the following points:

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  • Automobiles
  • Automobile and personal property, such as a fence or mailbox
  • A vehicle and a pedestrian

If you are the victim of a hit-and-run, your uninsured motorist insurance policy may be able to compensate you for your losses. A hit-and-run accident is often covered by one of two forms of uninsured motorist coverage:

  • Uninsured motorist property damage: If your car or property is damaged as a result of a hit-and-run collision, uninsured motorist property damage will pay for the repairs.
  • Uninsured motorist bodily injury: If you are wounded in a hit-and-run collision, your medical bills will be covered by uninsured driver bodily injury insurance.

Take note that UMPD is not available in all states, and even when it is available, it may not cover hit-and-run accidents in those states where it is offered. The UMPD coverage for hit-and-run accidents may be subject to a deductible in your state if such coverage is available.

When it comes to hit-and-run accidents, the following states do not have UMPD coverage; nevertheless, you can use your collision insurance to pay for car damages in these states:

  • Georgia and Illinois are among the states where this is true.
  • Louisiana and Ohio are two states with a lot of history.

You should follow these measures if you have been the victim of a hit-and-run accident:

  1. Step 1: Pull over to a safe location. Check to see that you and your passengers are all right. To chase after the other driver is not a good idea at all.
  2. Step 2: Make a thorough note of all of the details surrounding the accident. Even if you didn’t get a chance to see the license plate, a description of the car (make, model, color, and driver) and the circumstances surrounding the accident could be helpful during the insurance claim process. Note the date, time, and location of the accident, as well as the names and contact information of any eyewitnesses who may have witnessed the incident.
  3. Step 3: Make a call to the authorities.
  4. Step 4: Take pictures of the damage to your automobile as well as the surrounding area.
  5. Step 5: Make a call to your insurance provider.

Do I need uninsured motorist coverage if I have Medicare?

Uninsured motorist coverage is required in all states that mandate it, regardless of whether or not you have health insurance. If your state does not require it, you may not require it if you have decent health insurance; nonetheless, it is worth considering if you have a high deductible, copays, and coinsurance on your health insurance plan, which is common.

Uninsured motorist coverage can also be used to compensate for benefits such as lost wages and pain and suffering incurred as a result of the accident. Health insurance will not cover the costs of them.

Do I need uninsured motorist coverage if I have collision and comprehensive coverage?

When driving in a state where uninsured motorist coverage is mandated, you’ll be required to acquire it regardless of whether you have collision and comprehensive coverage.

If you live in a state where mandatory minimum coverage is not needed, it’s a good idea to consider it. Collision and comprehensive insurance will assist you in paying for repairs to your vehicle, but those coverage types will not reimburse you for medical bills if you are struck by a driver who does not have auto coverage.

Funeral expenses, pain and suffering compensation, and lost income if you are unable to work as a result of the automobile accident are all covered by uninsured motorist coverage. Uninsured motorist coverage does not replace collision and comprehensive coverage.

Should I buy uninsured motorist coverage for property damage?

If you already have collision insurance, you probably don’t need uninsured motorist protection (UMPD) unless your state requires it. This is due to the fact that collision coverage compensates for damage to your vehicle regardless of who caused the accident. The UMPD only pays in certain circumstances, but it may have a lower deductible than the deductible you picked for your collision insurance.

According to the most recent statistics from the National Association of Insurance Commissioners, the average claim payment for UMPD is $1,805.

What happens if I don’t have uninsured motorist coverage?

If you do not have uninsured motorist coverage and are hit by a driver who does not have insurance, you may be able to file a lawsuit against the at-fault driver in court. However, you would almost certainly need to retain the services of an attorney, and the legal procedure may be lengthy.

Medical expenditures incurred as a result of an uninsured vehicle accident are covered, as well as lost wages, pain, and suffering, as well as burial expenses. Take your chances in court rather than letting your insurance company take care of your medical bills because it is less stressful.

What does it mean to “stack” insurance?

When you file claims on two uninsured motorist policies at the same time, this is referred to as stacked insurance. If you’re injured in a car accident, stacking your insurance policies can help you collect extra money to meet your medical expenses. Stacking is not permitted in many jurisdictions, and some auto insurance companies have an “anti-stacking provision,” which means you will not be allowed to file several uninsured motorist claims for the same car accident.

If you are able to stack insurance policies, there are typically two ways to do so:

  • Coverage for two vehicles that are insured under the same policy can be stacked.
  • Coverage for two vehicles that are insured under two different policies in your name can be stacked.

Here are some examples of how stacking might be implemented.

Including multiple types of insurance in a single policy

Take, for example, a car insurance policy that provides coverage for two vehicles, each with $100,000 in uninsured motorist bodily injury coverage. If you are wounded in an accident caused by an uninsured motorist who hits one of your vehicles, you may be able to “stack” coverage and get up to $200,000 in benefits.

Combining insurance coverage from two policies

In this case, you have coverage for two vehicles under two distinct policies, each with $100,000 in uninsured motorist coverage. If you are wounded as a result of an uninsured motorist colliding with one of your vehicles, you can stack up to $200,000 in uninsured motorist compensation. Both insurances must be named after you.

Additional factors to consider when considering insurance stacking include the following:

  • Stacking is often more expensive. Additionally, you must elect to stack when purchasing or renewing a policy. After an accident, you cannot add or use stacking.
  • Uninsured motorist coverage protects you in the event of a car accident caused by another party. If you are wounded in a car accident you caused, you cannot claim or stack uninsured motorist coverage

Following are the steps to take if you are filing a claim using stacked uninsured motorist coverage:

  • If you are wounded in a car accident caused by a driver who does not have liability insurance, you will file a claim for medical expenses on your own uninsured motorist policy. If that is insufficient to cover all of your medical expenses, you can stack uninsured motorist coverage from another vehicle you own or another auto insurance policy you have in your name.
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  • If you are wounded in a car accident with a motorist who has some liability insurance but not enough to cover all of your medical expenses, you will first file a claim for your injuries against the other driver’s liability insurance. When that policy’s maximum coverage has been exhausted, you’ll need to rely on your own underinsured motorist coverage. If you use up one of your underinsured motorist coverages, you can stack it against another vehicle you own or another auto insurance policy in your name.

Bottom line

The liability auto insurance of the at-fault motorist is normally responsible for paying out any claims for damages or medical expenses resulting from the accident. But what happens if the driver who caused the accident does not have insurance?

Uninsured motorist coverage is designed to help you in this situation. The purpose of this policy is to protect you from financial loss in the event that you are involved in a collision if the at-fault driver is not insured. Almost every state requires drivers to have liability insurance to cover any property damage or physical harm that may occur as a result of an accident that they caused. Despite these regulations, some people continue to drive without a license.

When you get auto insurance in a state where you are required to have uninsured motorist coverage, it will be automatically included in your policy. When insurance comes to uninsured motorist coverage, if it is not required in your state, you’ll need to purchase it separately in order to include it on your policy.

If you live in a state where this coverage is optional and would like to include it in your policy, consult the website of your insurer to determine the most efficient manner to do so.

Charles Bains

Charles Bains

Charles Bains started his insurance career as a marketing intern before pounding the pavement as a commercial lines agent in Orlando, FL. As an industry journalist, his articles have appeared in a variety of trade publications. His insurance television career, short-lived but glorious, once saw him serve as the expert adviser on an insurance-themed infomercial (yes, you read that correctly). Having recently worked for various organizations, coupled with his broader insurance knowledge, Charles is able to understand our client’s needs and guide them accordingly. He is a gem for Insurance Noon as his wide area of expertise and experience have been beneficial in conducting further researches to come up with solutions and writing them in a manner which is easy for everyone including beginners to comprehend.

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