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Uninsured Motorist and Its Importance

What is Uninsured Motorist Coverage?

Uninsured motorist protects your property and yourself when a driver who was at-fault in an accident does not carry liability insurance. While technically optional, we strongly recommend that you carry this very important coverage. In fact, recent studies have shown that close to 12% of all drivers in the state of Georgia drive without liability insurance. So, if one of these drivers is at fault in an accident that causes damage to you or your property, you may be stuck footing the bill. However, by carrying Uninsured Motorist coverage, you can prevent yourself from coming out of pocket due to someone else’s mistake.

What if they have insurance, but the limits are less than the damage?

Even if someone carries liability insurance, it may not be enough to cover the damage caused. In fact, in Georgia, the state minimum required liability limits are $25,000 in bodily injury per person, $50,000 for bodily injury in total per accident, and $25,000 for property. This is where Underinsured Motorist coverage (UIM) comes into play. Picture a scenario where the damage done exceeds the liability limits carried by the at fault party. UIM coverage will kick in to cover the remaining balance, up to or in addition to your own Uninsured Motorist limits (depending on whether you carry reduced by or added on limits).

What is reduced by or added on?

These are your two UIM coverage options. They both take into account your Uninsured Motorist limits. This will determine the dollar amount of coverage you would receive in a UIM claim. If you choose reduced by, then your UIM limits will simply be your Uninsured Motorist limits, reduced by the other party’s liability limits. Let’s you carry $100,000 in bodily injury coverage per person, $300,000 per accident, and $100,000 in property damage. Now, the at fault party is carrying $25,000/$50,000/$25,000 in property damage. After their own limits are met, your new limits would be $75,000/$250,000/$75,000, which totals up to your UM limit.

Added on coverage takes the at fault party’s limits and adds them on to your own. So let’s say they carry $25,000/$50,000/$25,000 for their liability. Now you carry $100,000/$300,000/$100,000 for your UM coverage. Your new limit for UIM would be $125,000/$350,000/$125,000. Regardless of which you carry, UIM can be the difference in thousands of dollars for you and your family during a claim. Uninsured and Underinsured Motorist is a vital coverage to help cover you in your time of need. For more insight like this, contact us today for a free quote! It never hurts to make sure you and your family are receiving the coverage you need. Also, if you haven’t already, give us a like on Facebook!

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