UM? UIM? Why?

UM?  UIM?  Why?

            You listen to your insurance agent.  You follow your insurance agent’s recommendation.  You have adequate base automobile coverage as recommended.  Part of that coverage is uninsured motorist and underinsured motorist coverage.  But what is that?

            Your teenage daughter is involved in a car accident on her way to school.  She has been seriously hurt, but the accident is not her fault.  The accident was caused by another student who owns his own car and is paying his own way through college.  He may have minimum limits on his liability policy, or he may have no insurance at all. 

            Your daughter is going to recover but she will be hospitalized for a long period of time and there will be months of physical therapy.  Not only will the medical bills be high, but she is losing her part-time job and will lose a year of school, meaning she will graduate one year later. 

            Your policy pays for the automobile and pays for a portion of her medical bills.  You have health insurance that covers some of the medical bills, but there is a large deductible.

            You contact an attorney specializing in injury claims.  In one of the early meetings he informs you that the other driver was either not insured or has only minimum insurance levels.  What do you do? 

            Uninsured motorist coverage (UM) and underinsured motorist coverage (UIM) is insurance that you buy.  UM and UIM provide a liability policy to cover the damages caused by negligent acts of others who are either uninsured or underinsured.  If you have adequate UM and UIM coverage, your daughter will be able to recover damages for her pain and suffering, her lost time at school, her lost wages, and medical bills that aren’t covered by other sources.  In reality, UM/UIM coverage saved the day.

            Some policyholders are tempted to buy only a minimum amount of UM/UIM coverage or perhaps decline the ability to buy any.  That is a mistake. 

            Buy UM and UIM coverage at the same level as the liability limits you have purchased.  For example, if you have purchased a policy to cover $200,000 per person and $500,000 per occurrence, do the same with UM/UIM coverage. 

            It is the only part of the liability policy that will pay you money.

            Discuss UM/UIM coverage with your insurance agent.

The information provided above is general in nature, and should not be construed as legal advice applied to a specific situation.  Please discuss the facts of your situation with a qualified professional. 

Watland & Allen, PLLC • 393 East Palm Lane, Phoenix, AZ 85004 • (602) 252-0115

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