Finance
What is Uninsured/Underinsured Motorist Coverage?
Each state requires drivers carry a minimum amount of a specific type of car insurance; drivers who do not carry this insurance are uninsured motorists. Drivers who carry the necessary insurances for their state but still do not have enough protection in case of a very serious or costly accident are underinsured motorists.
Most state required policies include uninsured/underinsured motorist coverage, or UM/UIM. This part of a policy comes into effect if the party responsible for the accident fits either the uninsured motorist profile or the underinsured motorist profile and pays the injured policyholder’s medical bills that the responsible party should have paid but did not have adequate coverage. This is a very important facet of an auto insurance policy but is often overlooked; 1 out of every 3 drivers does not carry adequate amounts of auto insurance.
Drivers who do not carry the required amount of car insurance cover face hefty tickets and fines if police pull them over and discover they do not have the required policies. Many times penalties include having to go to court, pay the ticket, pay fines associated with the court proceedings, and often result in suspended or revoked licenses and other driving restriction consequences.