If your car is involved in an accident and it’s the fault of the other driver, it’s easy to assume that the individual’s insurance policy will cover the damages. Unfortunately, it’s not quite that simple. The other driver may have no insurance or not enough insurance to cover the damages. Although it’s illegal to drive without insurance, some people continue to do it. The Insurance Research Council reports that 16 percent of drivers are uninsured, and if you’re hit by one of them, you could end up paying to repair your vehicle out of pocket.
Fortunately, uninsured motorist coverage is available and will protect you in the event that you are involved in an accident with someone who doesn’t carry insurance. Your uninsured motorist coverage will typically cover the damages made to your car, and also for injuries sustained in the accident. (In some states, this is covered under an insured’s collision policy.)
The Best Coverage Includes Uninsured and Underinsured Motorist Coverage (H2)
Uninsured motorist insurance covers more than just situations where you’re driving and get into an accident. This coverage can also protect you in hit-and-run situations or when your car is hit when parked, even if you’re not in it. If you’re walking across the street and are hit by a vehicle, the uninsured motorist portion of your policy may cover the damages.
A second type of related insurance to consider is underinsured motorist coverage. If the person who caused the accident doesn’t have enough insurance to cover the damages, underinsured motorist coverage will pick up the difference. Both types of motorist coverage have bodily injury and property damage components to them. The bodily injury part covers the medical expenses to you and your passengers, while the the property damage portion covers damage to the vehicle. Many times uninsured and underinsured coverages are grouped together by insurance carriers.
How Much Coverage Should I Have?
There is no one right answer for how much coverage you should carry. This can get tricky since coverage ranges from $20,000 to over $1 million, so it’s best to factor in your accumulated assets and risk tolerance. Also keep in mind that each state has its own uninsured motorist laws, so it’s important to seek out the advice of your insurance professional to ensure that you have adequate coverage regardless of where you travel.