Do you really need to buy uninsured motorist coverage?

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Two Drivers Exchanging Insurance Details After Car Accident
Image Credit: Dreamstime

Being involved in an auto accident is no fun. But it’s doubly no fun if you’re hit by a driver who doesn’t have insurance and you don’t have an important type of insurance called uninsured motorist coverage.

Uninsured motorist coverage (and the closely related underinsured motorist coverage) exists to help pick up the tab when you’re in an accident with a driver who is at fault and either has only state minimums for liability or no coverage at all.

“When you buy auto insurance, it’s common that you’re looking to shave every dollar you can from the premium,” money expert Clark Howard says.

“So a lot of people buying auto insurance will ignore [uninsured motorist coverage,] which is actually one of the most important things for you to have as part of your policy.”

In this article, we’ll take a closer look at uninsured motorist coverage and why Clark says you really need to have it.

Uninsured motorist coverage: Table of contents

What does uninsured motorist coverage cover?

First, it’s important to know that uninsured motorist coverage steps in to help in two scenarios:

  1. When the motorist who hits you has no liability insurance
  2. When the motorist who hits you is a hit-and-run driver

The protection it offers has two basic components. They are:

Bodily injury

Bodily injury coverage typically covers medical expenses, lost wages and injury-related expenses for you and your passengers if you’re in an accident with an uninsured driver and covers medical bills in hit-and-run accident situations.

Property damage

Property damage coverage typically covers damage to your vehicle cause by an uninsured driver and may protect your property in hit-and-run accidents in some cases. This varies from policy to policy.

Who needs uninsured motorist coverage?

Clark says it’s more likely that you’ll be hit by someone with liability coverage at state minimums, rather than by somebody with no insurance at all.

But that’s no cause for celebration.

“In most places, state minimums are not enough to deal with even a minor injury that someone may have,” Clark says.

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The consumer champ notes that states have purposely kept their required minimums extremely low in an effort to make premiums more affordable. That way, more people will buy coverage instead of going without — in theory, at least.

Yet the problem is these low state minimums on liability aren’t nearly enough to pick up the tab when someone is hurt.

“If anybody has any meaningful injury, you’ll blow through that state minimum that the driver who hit you has in probably three hours in a hospital,” Clark says.

That’s why having uninsured motorist coverage is so important and why Clark recommends that every driver have it.

In fact, nearly half the states in the nation require motorists to carry it. However, the following states make uninsured motorist coverage optional, not mandatory:

  • Pennsylvania
  • Virginia
  • Delaware
  • New Jersey
  • Rhode Island
  • Tennessee
  • Kentucky
  • Indiana
  • Ohio
  • Michigan
  • Iowa
  • Arkansas
  • Louisiana
  • Mississippi
  • Alabama
  • Georgia
  • Florida
  • California
  • Nevada
  • Idaho
  • Montana
  • Wyoming
  • Utah
  • Colorado
  • Arizona
  • New Mexico
  • Texas
  • Oklahoma
  • Washington

How much does uninsured motorist coverage cost?

While a number of factors can influence your the cost of your insurance policy, here’s a real-life policy illustration for a 2007 Hyundai Sonata in Georgia. This shows how much the coverage can cost under some circumstances:

Travelers uninsured motorist coverage
Insurance Coverage limits Annual premium
Bodily injury liability $100,000/$300,000 $531
Property damage liability $100,000 $181
Uninsured motorists bodily injury $100,000/$300,000 $138
Uninsured motorists property damage* $100,000 $28
*The uninsured motorists property damage part of the policy has a $250 deductible in this case. It could be higher or lower depending the policy.

Final thought

Uninsured motorist coverage is a vital protection for you as you drive around.

“We cannot control, once we are on the roads, who decides they want to meet us in an unfriendly way with their vehicle,” Clark says. “That’s why I’m such a big fan of it.”

Meanwhile, if you’re shopping for a new auto insurance policy, be sure to check out our guide to the best and worst auto insurance companies.

More insurance stories you might enjoy from Clark.com:

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