Wednesday, April 8, 2009

Uninsured & Underinsured Motorists Liability

When the economy is down, people will be tempted to skimp where they can. Some will choose to skimp on their Auto insurance. They may purchase the bare minimum ($25,000 liability limit in VA), or they may choose to go without insurance at all.

You may get hit by an uninsured driver; or you may get hit by a driver with liability limits that are inadequate to cover your damages. When a situation like this happens, look to the Uninsured/Underinsured Motorists Liability portion of your Auto policy.

What's that? Where's that? Look on your declarations page - under your Liability coverages. You will see this:

Bodily Injury Per Person/Bodily Injury Per Occurrence
Property Damage Per Occurrence

Medical Expenses (or PIP) (to be explained in a future post)

Un/Underinsured Motorists Bodily Injury Per Person / Bodily Injury Per Occurrence
Un/Underinsured Motorists Property Damage Per Occurrence

Your UM Liability limits should be the same as your Liability limits. After all, this is insurance that will pay for bodily injury and property damage to YOU and YOUR CAR - if you're hit by an un/underinsured driver. This coverage should also pay for a rental car while your car is being repaired.

I have seen some companies include a $200 deductible for UM coverage. Check your policy to see what your company requires.

If you are hit by an uninsured or an underinsured driver, don't let your insurance carrier pay the claim under your Collision coverage. Make sure that they pay the claim under your UM coverages. You pay the premium for it, make sure they use it.

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