Underinsured Motorist Insurance – The Best Insurance Money Can Buy
Any good insurance salesman can tell you that insurance is about protecting yourself. That’s certainly true for car insurance as well. Most people think of car insurance as protecting your assets from a judgment – if you cause an accident, your insurance will be there to pay for the harm to the other person. But an even more important part of car insurance – and one often overlooked – is the kind that protects you in a situation where you aren’t at fault. In this situation, your insurance should protect you from the other person’s lack of insurance.
Underinsured Motorist Coverage (or UIM) is coverage to help you when another person causes an accident and does not have enough insurance to fully compensate you for the harm you suffer from the crash. And that’s necessary much more often than most people think.
South Carolina requires that all drivers have a certain minimum level of insurance. Unfortunately, that level is much too low. A driver in the state need only have insurance to cover $25,000 per person and $50,000 per accident. As anyone who has recently visited an emergency room knows, $25,000 is not a lot of money in the world of medical bills. And lots of South Carolinians are riding around with minimum limits coverage, having called some insurance company which promised to quickly save them money on their premiums.
Let’s take an example – say you’re driving through Greenville and another driver runs a light. You get roughed-up and report to the ER with a fractured elbow. The doctors tell you that you’ll need surgery to implant some hardware and you’ll then need some prescriptions and some physical therapy. You miss a few days from work as a result of all of this, so you have a claim for lost wages as well.
Your medical bills alone ultimately total $85,000. You also have lost wages of $2,000. After your lawyer obtains the insurance information from the other driver’s carrier, you find that he has minimum limits, meaning there is $25,000 available to compensate you for your claim. The insurance company sends that check over and closes its file. But you still have medical bills to pay, you’ve still lost wages, and you’re certainly entitled to something for the pain and harm you’ve suffered.
If your insurance coverage does not include UIM coverage, then you’re likely up a creek. All you’re recover is $25,000 and you’ll be left to make up the difference. But if you have UIM in your coverage, it’s a different story.
Let’s say you have $100,000 in UIM. Now you can recover $25,000 from the at-fault driver, then make a claim against your policy for another $100,000.
And things get even better if you have multiple cars with the coverage. In that situation, you may be able to do what’s called “stacking” and multiply your coverage. If you have two cars with $100,000 in UIM coverage, then your total available UIM is $200,000. Just like that, you’ve gone from having to come out-of-pocket to pay your bills to having more than enough insurance coverage to make you whole.
So check your policy and call your agent. UIM is the best insurance that money can buy.