Uninsured motorist coverage costs around $50-$75 annually for bodily injury and property damage coverage. Uninsured motorist coverage (UM) protects the policyholder by paying for injuries or damage resulting from a car accident caused by a driver who doesn’t have enough insurance.
Like any type of car insurance, uninsured motorist premiums vary based on the policyholder’s risk factors. How much coverage you purchase will also affect the cost of UM. Similarly, uninsured motorist premiums are higher in states with more uninsured drivers because of the additional risk.
Even if uninsured motorist coverage is not required in your state, it is an inexpensive coverage option that might be worth it depending on your circumstances.
Underinsured motorist coverage is a type of car insurance that applies when the policyholder is in an accident caused by a driver who doesn’t have sufficient liability insurance. If the policyholder’s expenses exceed the at-fault driver’s limits, underinsured motorist covers the remaining bills up to a certain amount.
Say that you are involved in an accident that leaves you with $35,000 in vehicle damage. Typically, the at-fault driver’s property damage liability insurance would pay to repair your car. But if that driver’s liability insurance policy only covers $30,000 in property damage per accident, underinsured motorist coverage would pick up the rest. This would prevent you from having to either file a lawsuit against the driver or pay the remaining $5,000 yourself.
Underinsured motorist coverage is required in some states along with uninsured motorist insurance, which applies when the at-fault driver doesn’t have any liability insurance at all. But even if it’s not required, underinsured motorist coverage is still optional in most states. To learn more, check out WalletHub’s guide to uninsured/underinsured motorist coverage.
Yes, you do need uninsured motorist coverage if you live in one of the 20 states that require all drivers to have uninsured motorist (UM) insurance. Even if uninsured motorist coverage is not mandatory in your state and can be declined, it's great to have coverage that protects you in the event of an accident with an uninsured driver.… read full answer
Uninsured motorist coverage costs around $50 to $70 annually for both bodily injury and property damage coverage. Considering how affordable it is, it’s almost always worth the investment.
Note: Uninsured motorist coverage is also required in the District of Columbia.
If you live in an area that has a high percentage of uninsured drivers, it is especially important to protect yourself. Mississippi has the highest rate of uninsured drivers, at 29.4%, while the state with the lowest uninsured-driver rate is New Jersey, at only 3.1%. Remember that your standard liability insurance will not protect you in an accident with an uninsured motorist.
However, there are some instances where uninsured motorist insurance may not be necessary. Several other types of coverage can offer protection in any accident, regardless of whether the other driver has insurance.
You can afford to pay out-of-pocket for your own injuries and property damage resulting from a serious accident.
Finally, it’s worth noting that uninsured motorist coverage is often combined with underinsured motorist insurance, which helps cover your accident-related expenses if the at-fault driver has insurance but not enough coverage to pay for your costs.
No, you should not reject uninsured motorist coverage unless you have collision insurance and enough medical coverage to pay for your expenses after an accident caused by an uninsured driver. Drivers can reject uninsured motorist coverage in states where it is optional but still has to be offered by insurance companies. For instance, drivers in California, Florida, and Texas can legally reject uninsured motorist coverage. In 21 other states, including New York and Illinois, uninsured motorist coverage is required, so drivers cannot reject it. … read full answer
Uninsured motorist (UM) coverage is still a good investment even if it’s not mandatory in your state. The price of UM varies based on each driver’s risk factors, but it averages around $50-$75 annually. Given that an estimated 1 in 8 drivers in the U.S. is uninsured, this coverage is an inexpensive way to protect yourself financially.
Uninsured motorist insurance is divided into two categories, bodily injury and property damage. Both kinds of UM insurance are designed to replace the liability coverage that an at-fault driver should have purchased. Covered drivers can file a claim with their own policy if they are in a crash caused by someone without liability insurance. Depending on the state and the policy, drivers might also purchase underinsured motorist (UIM) coverage, which can be used when the at-fault driver’s liability insurance is insufficient.
What Happens If You Reject Uninsured Motorist Coverage?
If you reject uninsured motorist coverage, you will need to use another type of coverage or pay out of pocket in the event that you are hit by an uninsured driver. If you already have collision insurance and medical coverage of some sort, rejecting uninsured motorist coverage might be a good way to lower your premium. Otherwise, paying for uninsured motorist coverage is generally an inexpensive way to add extra protection.
However, keep in mind that the average uninsured motorist bodily injury claim was $32,337 in 2016, the latest year with data. So a few thousand dollars of PIP will not cover you for a serious accident with an uninsured driver. Similarly, UMBI requires you to pay fewer out-of-pocket expenses than general health insurance when you need to pay for medical bills after a qualifying accident.
Uninsured Motorist Property Damage Coverage
Uninsured motorist property damage (UMPD) coverage is only available in some states. UMPD is less important than the bodily injury variation for most drivers, since it overlaps entirely with collision insurance.
The main advantage that UMPD has over collision insurance is that it usually has lower premiums, since it covers fewer situations. UMPD could also be a worthwhile purchase if you don’t want your collision premium to increase in the event of a claim after an accident with an uninsured driver.
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