Why Uninsured & Underinsured Car Insurance Coverage is So Important

Every time you get behind the wheel of a car, there is a very real chance that you could be involved in a car accident and be injured or killed. Don’t think so? Consider the statistics:

  • There are over 5 million car accidents in the United States annually.
  • Over 1.5 million of those car accidents result in injury or death.
  • Car accidents claim the lives of nearly 4 people every hour in the United States.
  • Car accidents are the leading cause of death for children and teenagers.

These statistics are sobering, but there is another statistic that is equally troubling: 14% of all motorists do not have car insurance – about one in seven drivers. With the number of uninsured drivers on the rise, it is now more important than ever to make sure that you have good coverage on your own car insurance policy.

Insurance companies offer what is known as uninsured motorist (UM) and underinsured motorist (UIM) coverage. This coverage is there to protect you and your family in the event you are injured in a car accident due to the fault of an uninsured or underinsured (too little coverage) driver. Most people don’t even realize this coverage is available, but understand this: it is the single most important coverage on your policy.

Here is how it works: If you are injured in a car accident and the at-fault driver has no insurance, you can make a claim against your own insurance company for the available UM coverage on your policy. Similarly, if you are injured in a car accident and the at-fault driver is underinsured carrying only a minimal insurance policy (ie. $15,000), you can make a claim against your own insurance company for the available UIM coverage. Both UM and UIM coverage provide compensation for medical expenses, loss of income, out-of-pocket expenses, pain-and-suffering, and other losses.

With so many uninsured and underinsured drivers on the road, it is critical that you have good UM and UIM coverage. A good rule of thumb when evaluating your coverage is to make sure that your UM / UIM coverage is at least equal to your bodily injury liability coverage. Bodily injury liability coverage is the maximum amount of coverage that your insurance company will payout if someone is injured due to an accident caused by you. If you have higher limits for bodily injury liability coverage than you carry for UM / UIM, you have effectively insured someone else for more than you have insured yourself in the event of you are injured in an accident.

My recommendation: Purchase as much UM / UIM coverage as you can afford. I recommend that you carry, at a minimum, coverage in the amount of $100,000 per person and $300,000 per accident – often referred to as 100/300 coverage. Additionally, if you live in Pennsylvania and have more than one vehicle, you should always request “stacking” of your coverage. Stacking is relatively inexpensive and serves to multiply the coverage by the number of vehicles on the policy (i.e. 100/300 coverage becomes 300/600 coverage if you have 3 vehicles).

As a personal injury lawyer, I have represented countless individuals whom have been catastrophically injured in car accidents caused by uninsured and underinsured drivers. Very rarely do these individuals have sufficient UM/UIM coverage on their own policies to compensate them for their losses.

For these victims, it was too late to make sure that there was sufficient coverage available. You, on the other hand, have the opportunity to increase your coverage and ensure that you and your loved ones are protected in the event you are in an accident.