Uninsured and underinsured motorist insurance is vital coverage for drivers, but unfortunately, far too many people are on the roads without it. Let’s examine an overview of uninsured motorist (UI) and underinsured motorist (UIM) coverage, why it’s so vital, and what happens when people don’t carry this important form of insurance.
The Problem of Uninsured Drivers
Statistically speaking, up to 15% of drivers on the road don’t carry insurance on their vehicles at all. In fact, according to the Insurance Information Institute, in 2015 the numbers hit a whopping 13%. That’s a lot of people driving without insurance, which is not only illegal but dangerous.
Every state requires a minimum level of coverage. Wisconsin requires, at minimum, bodily injury, property damage, and uninsured motorist coverage.
What Is State Minimum Coverage?
Minimum coverage varies by state but can include any or all of four different varieties of insurance. These are:
- Body injury liability. This form of coverage pays for injuries suffered by others if you cause an accident.
- Property damage liability. This kind of coverage is in place to pay for damage to other people’s property from an accident for which you are responsible.
- Personal injury protection. Often abbreviated PIP or called no-fault insurance, this can cover medical expenses, disability, medical services in the home, rehabilitation, loss of income and other coverage as defined by the state and individual policies.
- Uninsured and underinsured motorist. This important kind of insurance protects you if you’re in an accident caused by someone else who doesn’t have enough coverage (or doesn’t have coverage at all).
The Problem Will Get Worse
Many people are taking advantage of reduced premiums or premium refunds right now due to the COVID-19 pandemic. In order to provide a degree of economic relief from the pandemic, many insurance companies are offering these refunds, while others are offering deferred billing. The problem with deferred billing is that it eventually comes due.
When people suddenly get large insurance bills that they can’t pay, they may lower their coverage or increase deductibles. At worst, they may drop their coverage entirely. This means that the problem of underinsured and uninsured motorists is bound to get worse.
What Is Underinsured Motorist Coverage?
Uninsured motorists have no insurance, while underinsured motorists carry only state minimum insurance, which, if they cause an accident, won’t cover the full damages. That means if you get struck by an underinsured motorist, their insurance may not be enough for you to collect full damages for the property damage and injuries you suffer.
The sheer number of underinsured drivers on the road makes it even more essential for you to carry a level of UI and UIM coverage on your policy. These policies are usually expressed in split limits, such as 100/300. In a split limit, the first number is the coverage limit per person in thousands, while the second shows total coverage per accident. So, a 100/300 split would cover each passenger up to $100,000 up to a maximum total payout of $300,000.
Uninsured Motorist Insurance from Billy Brown
An independent insurance company like Billy Brown Insurance in Delafield, Wisconsin, can work with you to make sure you have the right coverage to protect yourself and others. We can build you a package that will protect your specific needs. If you’re in the Delafield area and would like to review your coverage and premiums, we’re ready to help. Get in touch with us today!