You would never think of driving without insurance or without the proper minimum of insurance, based on Indiana state law.
However, you may be surprised to learn that there are numerous drivers on the road without auto insurance at all. Likewise, many drivers don’t have enough insurance to cover other drivers’ medical expenses were they to cause serious injuries.
In the auto insurance world, these are called uninsured motorists and underinsured motorists.
Uninsured & Underinsured Motorists Put You at Risk
If you were to get into a collision with one of these drivers and if the accident were their fault, who would cover your medical expenses?
Certainly not the other driver if they don’t have insurance. Or, if the other driver only has the minimum required amount of insurance, their limits may only put a small dent in your medical expenses.
In these situations, it’s wise to have an added coverage called uninsured/underinsured motorist coverage or UM/UIM coverage. This type of coverage is often offered together in one policy. In some states, it comes as two separate policies.
Below, we will discuss the merits of this type of coverage and how it works.
How Does UM and UIM Coverage Work?
- UM Coverage covers you if you’re injured after an accident with an uninsured driver (where they were at fault).
- UIM Coverage gives you added coverage if an underinsured driver causes you an accident, and their limits don’t meet your medical expense needs.
Do You Have to Have UM and UIM Insurance Coverage?
In select states, UM and UIM coverage are required by law. Other states do not require UIM coverage, but they may require UM coverage.
Finally, some states do not require either type of coverage. However, it is often the case in these states that if you do not want UM and/or UIM coverage, you need to “reject this coverage in writing.” What this means is that UM and UIM coverage may be included in your auto insurance plan automatically. It’s up to you to put in writing that you “reject this coverage” if you do not want it.
This is the situation in the state of Indiana. That is, UM and UIM coverage are not required. They may be included automatically in your auto insurance plan, however. If you don’t want this coverage, you’ll need to reject it in writing.
Still, it is recommended by most insurance experts that you carry UM and UIM coverage. It’s worth noting that this is usually an inexpensive type of coverage. Moreover, it can save you a lot of money in the long run.
Understanding Uninsured Property Damage Coverage
There is one other type of uninsured motorist coverage that we haven’t talked about yet. It is called uninsured motorist property damage coverage.
Standard UM and UIM coverage only takes care of medical expenses. So, for example, let’s say an uninsured motorist caused a collision with your vehicle. You were injured. In this case, if you had UM coverage, it would take care of the medical expenses up to the limits in your policy.
However, if there was damage done to your vehicle, your UM coverage doesn’t pay for this. Naturally, the other driver’s nonexistent insurance won’t be able to pay either. In this case, you’d be wise to have uninsured motorist property damage coverage or UMPD coverage.
In Indiana, this is an available type of insurance. If you don’t want it, you’ll need to, again, reject it in writing.
For any questions about UM/UIM/UMPD coverage, the agents at Butler Insurance are here to assist you. Stop in or give us a call today to find out more.