UM/UIM is a type of auto insurance that is optional. You can add it onto your existing auto insurance policy.
Who benefits from UM/UIM insurance?
The person who purchases the UM/UIM policy is the beneficiary of the policy. This means that if you purchase UM/UIM insurance as part of your auto insurance, and if you were then to get injured in an auto crash that is someone else’s fault, your UM/UIM policy would come into play to make sure there is enough insurance available to cover your damages (up to the policy’s limits).
What types of expenses does UM/UIM cover?
UM/UIM insurance covers everything that your regular bodily injury liability insurance covers, including medical bills, loss of earning capacity, physical pain and suffering, mental anguish, disfigurement, and physical impairment.
UM/UIM vs Third Party Bodily Injury Liability Insurance
If you’re injured in a crash caused by someone else, the first insurance policy that comes into play is that other person’s bodily injury liability policy. Often times other drivers are completely uninsured (they don’t have any insurance, which is illegal), or they have an insurance policy that doesn’t have limits high enough to cover your damages.
An example of this would be if you’re injured in a crash and have $150,000 in medical bills. If the other driver has a $30,000 policy, the insurance company will write you a check for $30,000 and wish you luck with your remaining $120,000 in medical expenses. This scenario doesn’t even take into account other damages like lost wages or pain and suffering.
For these reasons, it is beneficial to have a UM/UIM policy on your own auto insurance. Taking the above example, if you had a $300,000 UM/UIM policy, you could now make a claim against that policy to help pay the remaining $120,000 hospital bill. There would even be enough insurance coverage remaining to pay for pain and suffering and lost wages.
Liens
Because UM/UIM coverage is first-party—meaning you purchase it for your own benefit—hospitals cannot attach a lien to any benefits paid out.
Can I handle my UM/UIM claim on my own?
While it is tempting to handle these claims without the help of an attorney, it is often unadvisable. Many people think that because they are dealing with their own insurance company, the insurance company will have their best interests at heart, and they’ll get a good settlement. In reality, Insurance companies looks at all claims the same: money out the door is bad for business; they don’t care that the claimant is one of their own customers.
UM/UIM claims can be complicated because the insurance company is trying to limit your recovery, but they don’t have the cooperation of the at-fault driver (because that person is not their insured). Hiring an attorney may be worth the cost in terms of increasing the overall value of the claim and eventually the settlement.
Should I buy UM/UIM coverage?
Because UM/UIM coverage is affordable, and because you can never be sure that the person who injures you has enough insurance (or any at all!), we absolutely recommend buying UM/UIM coverage, and maxing it out (matching your bodily injury liability limits).
Recent UM/UIM results
We recently settled a very sad case where our client was broken down on the side of the road after the car she was a passenger in slid of a patch on ice and hit a guardrail. She was waiting for a friend to come pick her up when another car slid on ice, pinning our client between that car and the car she was originally in. Her legs were amputated, and she died at the scene from her injuries.
The at-fault driver had just $30,000 in applicable insurance. The driver of the car she was in had a $50,000 policy. But because our client had a $500,000 UM/UIM policy, we were able to make a substantial recovery for our client’s father.