Car Insurance Coverage

Understanding the Basic types pt.2

UIM Coverage and Comprehensive

Uninsured or underinsured motorist coverage is has normally been very inexpensive because the odds of hitting an uncovered driver were relatively small. It is recommended that you have at least $100,000 of coverage per individual riding in your car and a total of $300,000 per accident. Many states require proof of this coverage before they issue a driver’s license or a car registration. Even if the insurance is optional in your state, obtain it to protect yourself.

Uninsured motorist Coverage (UIM) protects you and your passengers from uninsured motorists.     This is especially important in states without no-fault laws.    You are reimbursed for bodily injury or death in accidents where the uninsured motorist is liable. UIM covers payments for medical expenses, losses due to permanent disability or death, loss of income, and other damages entitled by state law. It does not reimburse you for property damages.

Insurance companies’ minimum coverage usually coincides with state minimums required for liability coverage. Although UIM is a normal part of every insurance policy, you may elect to reject it. However, you must do so in writing. UIM premiums are on the rise because of the increasing numbers of drivers without insurance who violate state laws. Therefore, the probability of having an accident with an uninsured motorist rises, which forces premiums up. There is a newer category of coverage called underinsured motorist (UNM) coverage. This coverage applies if you have an accident with another driver who is at fault but whose insurance coverage limits are unable to compensate you for your damages. You can buy coverage limits similar to those available for liability. UNM coverage may be a separate coverage with its own premium, or it may be part of the UIM coverage. State law determines what constitutes a UNM loss and under what conditions you will receive payment.

With car insurance, comprehensive coverage reimburses you for damage caused by mishaps other than a crash, including vandalism, theft, falling objects, flooding, glass breakage, and collisions with animals. It carries a deductible that normally ranges from $50 to $1,000.     For an extra premium, you can get full glass damage coverage with no deductible.   

The insurance companies, by the way, agree in the policy to defend you in any litigation that results under the policy. But they also reserve the right to settle any litigation without your permission.