The Weekly Vista

The Difference between Uninsured and Under-insured Coverage


Both uninsured motorists and under-insured motorists insurance cover you when another driver is at fault in an accident and is not adequately insured to cover the expense of your injuries, property damage, and even lost wages. In some states, you are required to buy uninsured/under-insured motorists coverage, and in other states age, and you are involved they are optional. Make sure you check with your agent.

While they sound similar, uninsured and under-insured motorists coverage provide two different types of insurance, as follows.

Uninsured Motorist Coverage: Uninsured motorist covers your costs in the event that he at-fault driver does not have even the minimum liability insurance, and has no coverage to pay the costs of your bodily injury and property damage.

People who drive without car insurance may feel that the fine for not being insured is likely to be less than the cost of insurance. These drivers are therefore unprepared for the possibilit­y of being responsibl­e for injury, fatality or property damage they may cause others. This is where the uninsured motorist coverage on your policy responds. It covers expenses you incur, up to the limits you set on your own auto insurance policy, and after you pay your deductible.

Note, however, that if you have a collision deductible waiver associated with your policy, your deductible may be waived if you are in an accident with an uninsured motorist.

Under-insured Motorist Coverage:

Under-insured motorist insurance covers your costs in the event that the at-fault driver has the minimum coverage, or a very low amount of insurance. Liability limits can be as low as $15,000 in some states. When you consider the fact that you can incur costs in that ball-park for a single night’s stay in a hospital, it helps to provide perspectiv­e on the importance of under-insured motorist insurance.

If you have this coverage, and you are involved in an accident with a driver who has insufficie­nt liability coverage, you will have access to the maximum limits of that driver’s liability policy, after which your uninsured motorist coverage will kick in to pay for your injuries and property damage up to your policy’s limits.

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