Top Reasons To Buy Underinsured Motorist Insurance

The purpose of underinsured motorist insurance is to cover the difference in medical and repair expenses not covered by another driver’s liability insurance policy, in the event of a car accident.

For example, if you are involved in an auto accident that results in $25,000 in repair expenses, but the other driver only carries $10,000 in property damage liability insurance, your underinsured motorist insurance will cover the remaining $15,000.

 

Reasons to Consider Underinsured Motorist Coverage

Most states require drivers to carry a minimum amount of liability insurance, as determined by your state, or prove financial responsibility using some other state-approve auto insurance alternative.

For example, in the state of Oregon, drivers are required to carry a minimum of 25/50/10 split liability insurance. This split insurance amount represents $25,000 in bodily injury coverage per person, $50,000 in bodily injury coverage per accident, and $10,000 property damage coverage per accident.

On the other hand, in Texas you can make a cash or securities deposit of a certain amount to your country comptroller or judge.

Unfortunately, in the event of a serious auto accident, this minimum amount (whether you meet it with a traditional insurance policy or a deposit) will likely not be enough to cover damages to your vehicle, in addition to medical expenses for injuries accrued and lost wages due to injuries accrued.

For this reason, you might want to consider purchasing underinsured motorist insurance, which will cover the difference in injury-related and repair expenses.

 

Minimum Liability Insurance Requirements

Many drivers choose to carry no more than the minimum liability insurance requirements. At the time they purchase their policies and make their premium payments, this seems like a smart financial move. In many cases, however, it's not.

So, when you consider purchasing underinsured motorist coverage, take your state’s minimum liability insurance requirements into account, and then consider if this minimum amount will likely be enough to cover you in the event of an accident―especially if the other party turns out to be an underinsured driver.

NOTE: It's especially advisable to purchase underinsured motorist coverage if you live in a state with relatively low liability insurance requirements.

 

Filing an Underinsured Motorist Claim

In order to be compensated for an underinsured motorist claim, the underinsured driver must be determined at fault for the auto accident. For this reason, it is highly advisable to hire an auto insurance attorney when filing an underinsured motorist claim, particularly in the case of a disputed claim.

It is also important to contact your car insurance company immediately, and to present the official police report to the insurance adjuster.

 

Comparing Car Insurance Quotes

You can compare quotes for underinsured motorist coverage online, or by contacting the Insurance Department in your state. You can also add underinsured motorist coverage to a preexisting auto insurance policy by contacting your car insurance provider, directly.

Be sure to inquire about the details of the coverage available to you, to include any limits or coverage exclusions.