Why UM/UIM Coverage Is A Good Idea

You might be wondering what uninsured/underinsured (UM/UIM) motorist coverage is. Simply put: UM/UIM coverage comes into play when a third party injures someone (called a tortfeasor) but the tortfeasor does not have enough liability insurance to cover your damages.

Let’s look at a real life example: Joe is texting while driving and ends up causing a rear-end collision with Bella. Bella ends up injured and needs to go to the hospital. She has some sprain/strain injuries, as well as a torn meniscus in her knee, which needs surgical repair as a result of the car wreck. That treatment that Bella requires is expensive and costs $40,000.00, not to mention future cost of treatment and pain and suffering. Unfortunately, Joe only carried a liability policy of $25,000. What will Bella do?

If she is smart, she has her own UM/UIM coverage, which will come into play once Joe’s $25,000.00 policy pays out. Hopefully, she has UIM (underinsured) motorist coverage, which will then pick up where Joe’s liability policy left off. Now, let’s say Bella was really smart and carried a $100,000.00 in UIM insurance. That means that in addition to the $25,000.00 available from Joe’s insurance, now she has an additional $100,000.00 in insurance that she can pursue. Since her bills alone are minimally $40,000.00, now she will be in a much better position to be made whole, or put back to how she was before the wreck happened.

One thing that Joe should be worried about – he only carries minimum insurance. If Bella had broken her neck or had more severe/expensive injuries, Joe could be sued personally for the amount of damages above $25,000.00. Therefore, it is very important to carry enough liability insurance to cover yourself personally. If Bella did not have UIM coverage, the only other option she would have to recover for her damages would be to sue Joe personally. This could mean his wages would be garnished, his house and assets could be jeopardized, etc.

These situations arise every day and we see them all of the time. Protect yourself from people who are underinsured or uninsured by making sure you have adequate UM/UIM coverage. If you ever have questions, feel free to call an experienced attorney at GLP Attorneys.

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