Underinsured motorist (UIM) coverage is beneficial if you have been in an accident. More specifically if the accident is not your fault and the other driver does not have sufficient coverage. This is an ideal situation to have underinsured motorist coverage.
What Does Underinsured Motorist Coverage Do?
Underinsured motorist coverage will cover any medical expenses as well as property damages from an accident. It works to close the space between the other driver’s limited liability insurance and what your expenses are. It may take a while to find out if the other driver is underinsured. With an uninsured driver, you will usually find out at the scene. You may also find out that a driver is underinsured. However, until you know the full cost of the accident to you, the limits of the at-fault driver’s insurance cannot be fully determined. An accident may affect more than just damages to your vehicle. For serious injuries, there may be rehabilitation expenses on top of medical bills. You may also miss work due to your injuries and therefore lose wages. All of these details will be factored in.
How Does Underinsured Motorist Coverage Work?
Underinsured motorist coverage will cover your medical and damages expenses, but not the at-fault drivers. For example, say you have $50,000 in underinsured coverage. Then you get into a car accident which costs you $30,000. But, the at fault driver only has $15,000 liability coverage. This is where your UIM coverage helps. The insurance of the other driver will pay the $15,000 that they are able to. Then the leftover $15,000 will come from your UIM coverage. In all covering the $30,000 in expenses.