Uninsured /Underinsured motorist policy is an optional addition to your auto insurance policy to compensate for any damage or loss caused due to collision with a hit and run driver or a driver who does not have auto insurance. This is the portion of your auto insurance will compensate for the losses from the collision coverage portion of your own policy.
Uninsured motorist policy
The uninsured motorist policy covers you and insured members of your family and your passengers. It will compensate for the bodily injuries, damages to your vehicle or death caused by a driver who is at fault who has no auto insurance or a hit and run driver.
According to the UM laws, the payment of "damages" is for compensating for your bodily injury, illness, or disease, including death, that may result from your accident with an uninsured motorist. Depending upon the state UM laws, your UM policy may cover damages that include loss of income due to absence from work, punitive charges to sue the other driver and for pain and suffering.
However this policy will cover the expenses up to the limit your policy permits. The coverage is limited to the maximum amount allowed per person and per accident.
The uninsured motorist bodily injury coverage is highly beneficial to people who do not have health insurance cover. In this case it is advisable to choose a good limit as you will be paying for the costs from out of your pocket if the losses are more than the limit of your policy.
Underinsured motorist policy
The underinsured motorist policy covers you, insured members of your family and your passengers. This will pay for the losses or damages or death caused by the driver who has auto insurance but it is insufficient to pay for your losses. In this situation, your underinsured motorist policy will meet the difference of cost up to the limit specified in your policy. If the limit in your policy is lower than the loss, you will need to meet the costs personally, if you do not have health insurance.
Those who do not have health insurance can benefit from this policy even if the limit may not be sufficient to pay for the entire loss. Uninsured motorist bodily injury coverage is aimed at protecting the insured and his family even when traveling in other vehicles.
You are required to prove that the other driver was at fault and your damages are measurable. This coverage will be beneficial to the insured when it is use din conjunction with collision coverage.
You can consider underinsured motorist coverage to your existing auto insurance package if your want to protect yourself financially from being involved in an accident with a driver with inadequate auto insurance. It is usually combined with Uninsured motorist coverage in your auto insurance policy. It is designed specifically to cover the difference between the underinsured driver’s insurance limit and the actual cost of medical bills and repair bills.
As the number of uninsured and irresponsible drivers is on the increase, it is better to have sufficient protection in your auto insurance package and that includes uninsured/underinsured motorist coverage.