You know how important it is to carry car insurance on your vehicle. In fact, in most states, you can’t legally register your car without it. Unfortunately, however, some drivers opt to let their insurance expire. In some cases, this is deliberate, but let’s give them the benefit of the doubt-maybe they just forgot.
In any event, do you know what will happen if you’re involved in an accident with someone who’s uninsured? In this guide, we’ll talk about uninsured motorist coverage and how it can protect you.
What is Uninsured Motorist Coverage?
Let’s assume for a moment that you’re involved in an accident. You live in an at-fault state (the driver who caused the accident is financially responsible for damages). But the other motorist, who was clearly at fault, forgot to pay her car insurance bill.
Usually, you’d file a claim with her insurance company and be reimbursed for repairs and other costs. But since she’s not insured, that’s obviously not possible.
Uninsured motorist coverage protects you financially if this happens to you. Your insurance company will help you pay your bills, even when you’re not at fault.
Do I Need Uninsured Motorist Coverage?
The short answer is: maybe. Currently, 23 states require that you purchase protection against drivers who aren’t insured. The amount of insurance you need will vary depending upon your state’s minimums.
There are two types of uninsured motorist coverage: property damage liability and bodily injury liability. Check with your DMV and your insurance company to determine your state’s requirements for each.
In some states, uninsured motorist coverage can be declined. However, this sometimes requires that you can prove you’re financially able to cover costs in the event of an accident. If you’re not independently wealthy, this type of coverage might be a good idea!
How Much Coverage Do I Need to Purchase?
You’ll obviously need to purchase at least your state’s minimum requirement for uninsured motorist coverage, if there is one. But if your state doesn’t require this type of coverage, uninsured motorist coverage may still be a wise choice. Similarly, it may be smart to purchase more than state minimums.
The main purpose of this type of coverage is to cover the cost of medical bills following an accident. And let’s face it-hospital bills are expensive! If you feel that your medical coverage won’t be sufficient to protect you, consider purchasing additional coverage.
If you have great health coverage that will protect you in the event of a wreck, you may not need to worry about buying more than the minimum state requirement.
The secondary purpose of uninsured motorist coverage is to reimburse you for auto repairs or replacement. Consider your finances, and whether you have additional insurance that will help you financially should this reimbursement become necessary.
As you shop for your policy, speak with a knowledgeable insurance agent who can look over each of your insurance policies. Together, you can determine how much insurance you need.
How Much Does Uninsured Motorist Coverage Cost?
The monthly or annual premium you’ll pay for your uninsured motorist coverage will depend largely upon your insurance company and your coverage. Of course, the more coverage you carry, the higher your insurance premiums will be.
Additionally, the cost of your policy may depend upon the percentage of uninsured drivers in your state. For instance, a policy in Mississippi, which has the highest percentage, will likely cost more than a policy in New Jersey which has the lowest.
Other factors that will impact your rate include:
- Lapses in your past auto insurance policies
- Your age
- Your sex
- Your marital status
- The zip code where you park your car
- The make and model of your vehicle
- Your credit score
Remember that your uninsured motorist coverage is usually bundled in with your other coverages. However, if you have more than one vehicle, your state and insurance agency may allow you to “stack” your coverage, so you only have to pay once for this type of coverage.
Conclusion: Uninsured Motorist Coverage
There are many drivers out there( between 12 and 14 percent of registered drivers) who are uninsured. Maybe it was deliberate or maybe they just fell behind with their payments. Either way, you need to protect yourself against them.
If you’re involved in an accident and an uninsured driver is at fault, uninsured motorist coverage can save your wallet and provide peace of mind. Even if it’s not required in your state, consider adding this coverage to your policy.