Understanding Uninsured and Underinsured Motorist Coverage
Suppose you get into a serious auto accident that’s not your fault. What if the other driver has the minimum auto insurance required, or no insurance at all? Even worse, what happens if you’re the victim of a hit-and-run, whether as a driver or a pedestrian?
If the driver at fault has no insurance, or they don’t have enough insurance to pay for injuries and damages, you may have no choice but to cover the costs out of your own pocket.
Think you can recover the costs in court? This almost never works because people without sufficient auto insurance probably don’t have the money or assets to pay damages from a lawsuit.
This is why uninsured and underinsured motorist coverage is so important.
What Is Uninsured Motorist Coverage?
Uninsured motorist coverage helps cover the cost of losses when an accident is caused by a driver who has no auto insurance or a canceled policy. It can also pay for damage caused by a hit-and-run accident.
What Is Underinsured Motorist Coverage?
If you’re in an accident and the driver at fault doesn’t have enough insurance to pay for your losses, underinsured motorist coverage kicks in to help fill the gap for eligible expenses.
For example, if the costs of injuries and damage to your car total $100,000 and the driver at fault has insurance that will only cover $50,000, your underinsured motorist coverage will cover all or a portion of the remaining $50,000.
What Types of Expenses Are Covered by Uninsured and Underinsured Motorist Coverage?
Depending on your policy, uninsured and underinsured motorist coverage may pay for different types of bodily injury and property damage costs for the driver and passengers, such as:
- Medical bills
- Ambulance fees
- Rehabilitation
- Lost income
- Auto repairs
- Auto replacement
Why This Coverage Is Important
It’s no secret that inflation and affordability have made life difficult for people everywhere. Costs related to driving have gone up as well. New and used car prices. Financing rates. Gas prices. Repair and maintenance costs. Insurance rates.
Although New Jersey drivers generally have more auto insurance coverage than residents of other states, many drivers have the minimum liability coverage, which probably is not enough to cover losses from a serious accident.
The good news is that uninsured and underinsured motorist coverage can usually be added to a policy with a small increase to the premium!
Uninsured and underinsured motorist coverage provides peace of mind and protection in case you’re in an accident that’s not your fault. If you’d like to review your coverage and discuss your options, schedule an appointment with Stanton Insurance Group today!
