Being a responsible driver not only helps save lives but also keeps your finances in good shape. Unfortunately, not every driver you see on the road takes this responsibility as seriously and may be driving without insurance.

Uninsured motorist coverage (UM coverage) is an attempt to reduce your financial liability if you get in a severe car accident with someone who doesn’t have adequate auto insurance coverage.

Insurify, however, can help you get an auto insurance policy at the lowest prices available. Insurify can help you avoid the fate of uninsured or underinsured drivers who face a long financial climb out of an accident. Compare quotes between top-rated insurance companies all in one place!

When your policy is up, make plans to shop around and unlock discounts with Insurify. Until then, here’s what you need to know about uninsured motorist coverage:

What is uninsured motorist coverage?

You could be the safest driver you know, but you’re still at risk of getting into an accident with someone who isn’t insured. Even if you’ve never been in an accident before, live in a safe neighborhood, and have a clean driving record, you’re still at risk of getting into an accident that is somebody else’s fault. If that person doesn’t have insurance coverage, the cost of damage falls back on your shoulders—unless you have uninsured motorist insurance coverage.

The Insurance Information Institute reports 26.7 percent of drivers in Florida were uninsured in 2015—that’s one in four drivers. Twenty percent of drivers in Tennessee were underinsured motorists that same year. If you were in any type of accident with these drivers, you run a risk of having a damaged car…and damaged finances. While these numbers are on the higher end of the spectrum, there will always be drivers that simply drive without having enough insurance. You run the risk of running into one of these drivers every time you hit the road.

UM is a coverage option that provides the protection you need when the other driver can’t cover your medical expenses and damage to the vehicle. Whether they have no insurance or are underinsured, your insurance company would be able to step in to cover the costs of the incident. Uninsured motorist bodily injury coverage provides coverage for any injuries to passengers of the vehicle, as well as coverage for someone who was driving your insured vehicle with your permission.

Why would someone drive without insurance?

It’s illegal to drive without car insurance, but many people still do it. Whether they can’t afford the premiums or didn’t qualify for auto insurance, some motorists will simply continue driving and risk getting in an accident anyway.

Unfortunately, this is a considerable risk to take. The National Highway Traffic Safety Administration reports 34,439 crashes proved to be fatal in 2016 alone. Of these, 18,610 involved drivers and 6,407 involved passengers. The economic impact of these traffic crashes is significant.

Many people don’t realize the cumulative impact of a traffic incident and how much it costs not only the drivers involved but also taxpayers and the greater community. Since a serious incident can potentially cause traffic backups and congestion, require calling emergency medical services, and even lead to a court battle, you might face many other costs beyond medical bills and property damage.

The NHTSA reports that in 2010, the total cost related to traffic crashes in the United States amounted to $242 billion. These costs included:

  • Loss of productivity
  • Workplace loss
  • Legal and court expenses
  • Medical costs
  • EMS costs
  • Insurance administration
  • Traffic congestion expenses
  • Property damage costs

It’s also important to consider what causes these severe accidents in the first place. Even the most responsible driver can make mistakes, and many crashes could be prevented.

Alcohol-impaired driving is the leading cause of fatal accidents followed by speeding. Certain parts of the country have more drivers that break the law than others, so one’s location can play a role in the risk of running into a dangerous driver—including one that may or may not be adequately insured.

Do I really need uninsured motorist insurance coverage?

Several states require drivers to have uninsured motorist insurance because it provides extra protection in the event of a severe accident. These states are: Connecticut, Illinois, Kansas, Maine, Maryland, Massachusetts, Minnesota, Missouri, Nebraska, New Jersey, New York, North Carolina, North Dakota, Oregon, Rhode Island, South Carolina, South Dakota, Vermont, Virginia, West Virginia, and Wisconsin, as well as the District of Columbia.

Even though standard car insurance is required in all states except New Hampshire, not everyone follows the law. Certain states have higher rates of uninsured drivers than others. Since the probability of getting into an accident with an uninsured motorist is higher in these high-risk states, local policyholders may need to get extra coverage and pay higher premiums.

Whether it’s required or not, having underinsured motorist coverage can be a smart financial move. It doesn’t cost as much as people think and is an easy way to protect yourself in the event you’re involved in a serious incident.

How much does uninsured motorist insurance coverage cost?

Many people wonder how much uninsured motorist insurance or uninsured motorist bodily injury adds to their monthly premium. Every state has limit requirements per vehicle you own and drive. The actual amount is less than most people realize. Industry insiders claim that you can expect an increase of only about five percent of your annual insurance premium to have underinsured motorist coverage included.

However, the price of coverage varies significantly from state to state and largely depends on the percentage of uninsured drivers and the history of claims in a particular state. That’s why comparing car insurance quotes based on your needs and driver profile is the best way to determine just how much you’ll be adding to your premium.

Some states allow for “stacking” coverage when you have more than one vehicle. In this case, the liability limits can be multiplied by the number of cars insured under a policy, so the total claim paid out can be multiplied by the liability limit in the event of an accident. Other states prohibit this practice because it can drive up insurance costs with the larger payouts.

Types of uninsured motorist insurance coverage

Car insurance companies are aware of the need to provide additional protection over liability insurance. Having liability insurance is required in most states, but many drivers still choose not to have it. Even if someone has liability insurance, they could only have the minimum required by the state, which means they still wouldn’t be able to cover damages in a serious incident.

This is why auto insurance companies offer insured motorist coverage as an add-on to regular insurance. This type of insurance covers you if you’re not the at-fault driver, including if you are involved in a hit-and-run accident. If the damages exceed the amount included in their policy (or the other driver doesn’t have any), your underinsured motorist coverage will provide the coverage you need.

There are two types of uninsured motorist coverage: uninsured property damage insurance and uninsured bodily injury insurance. These make up the insurance package and are usually bundled together. However, they can be bought separately under certain circumstances.

How uninsured property damage insurance works

If your car is severely damaged in an incident that involves an uninsured driver, uninsured motorist property damage coverage (UMPD coverage) will cover all of the expenses related to restoring your car. If you buy UMPD coverage and already have collision coverage, some insurance companies will allow you to use your UMPD to pay your collision deductible. In these cases, you may not need the extra coverage because you’re getting the benefit you need from your collision insurance policy. Keep in mind that UMPD is not available in all states. You will need to request a quote from auto insurance companies in your area to find out what your options are.

How uninsured bodily injury insurance works

If you incur bodily injury or physical harm during an accident with an uninsured driver, you will likely end up with thousands of dollars in medical and health care bills. This includes the costs of rehabilitation and ongoing care stemming from the accident. Uninsured motorist bodily injury coverage (UMBI coverage) will pay for these costs and does not require paying a deductible before you can receive the benefit. UMBI also provides coverage for injuries related to a hit-and-run incident.

Uninsured motorist coverage limits

Uninsured motorist coverage (UIM coverage) is required in some states, and you must meet certain policy limits to meet state requirements. For example, in the state of California, the limit for uninsured motorist property damage is $3,500. The limits for uninsured motorist bodily injury are the same as your liability coverage limits.

Whether or not you choose to add UIM depends on the cost of the premium and whether you can realistically afford to go without it. In almost all cases, it makes sense to add this to your policy because you’re only paying about five percent of your annual premium.

Making sure you have sufficient insurance protection before you get behind the wheel is part of being a responsible driver, even if that means you have to be responsible for someone else’s irresponsibility. Find out if what types of UIM coverage your auto insurance provider offers and consider shopping around for the best car insurance plans that meet your needs.

A car insurance quotes comparison site like Insurify can help you choose among several insurance packages in one place, and even help you unlock discounts and savings for which you’re eligible.

Updated April 26, 2021

Sabah Karimi is a freelance writer and copywriter based in Florida. She covers auto insurance trends, tips, and personal finance advice for Insurify so readers can make informed decisions about car insurance and budgeting.