Do You Really Need Uninsured / Underinsured Motorist Coverage?


ATLInterstatePicture yourself driving on the Atlanta interstate system at any give time of the day. Usually there are a minimum of 4 other cars around you going in the same direction. Now, there are no signs on these cars that say “I have Liability Insurance and my limits of coverage are…” 

The fact is, Georgia Law only requires you to carry limits of $25,000 Per Person and $50,000 Per Accident for Liability and $25,000 for Property Damage to be legal. The fact is, there are people driving around with no insurance and probably two of the four cars around you have the minimum limits or no coverage at all.

So what does Liability Insurance cover? Liability means a person is “Legally Liable” for causing harm to someone or their property. They are shown to be negligent in their actions, causing bodily injury and/or property damage. 

Real Life Example (I hate to see this happen)

So, one of these four cars is responding to a text message with one hand and holding a mug of coffee in the other, while controlling the wheel with their knee. Let’s just say that one of the cars swerves and hits your car, causing you to leave the roadway and wind up in a ditch. Your $30,000 car is totaled. You have serious head injuries and several broken bones. You are now faced with a month in the hospital and at least 6 months of rehab after getting out. You cannot show property or work for 8 months, which means you don’t have an income. You didn’t set out that day expecting this to happen to you. No one does…accidents are never planned. However, this person who hit you chose to carry the minimum limits on their policy. They are driving a car worth $1,000, no job and have nothing in the form of assets to lose. Your medical bills are $90,000, lost wages are $50,000 and your pain and suffering from the ordeal is worth $100,000. You are out the total of $240,000. What will you do next?

Well, if you elected to carry Uninsured/Underinsured Motorist (UM) Coverage, you will need to file a claim with your insurance company to respond on your behalf. The limits carried by the at-fault driver obviously are not going to pay you $240,000. Their insurance company will gladly pay you $25,000 for your injuries and $25,000 for your $30,000 car, then walk away. And, you cannot get blood from a turnip, so good luck getting any more money out of the person that hit you.

You elected to carry the coverage, but chose the least amount of limits available to save a few dollars. So, unless you chose the new “Added-On” coverage for UM, you will not get anything because it only pays up to your limits carried as gap insurance. Even if you chose to pay the extra money for “Added-On” UM coverage, it will pay you an additional $25,000 for your injuries and $5,000 for your car.  You still are not made whole.

How to Avoid Losses

The smart thing to do is to carry limits equal to your own Liability Limits. So, if you carry $100,000 per person, $300,000 per accident and $50,000 for property damage on your liability, you should carry the same for your UM coverage. 

The question is this…what are you most in control of, your car or someone else’s car? Your insurance coverage or their insurance coverage? The simple answer is you have NO control over how someone else drives or what their coverage is. You’re more likely to be involved in an accident that is NOT your fault rather than one that is your fault. So, you should look for ways to save money in other parts of your life, rather than your insurance policy.

In the example above, you can turn the medical expenses in to your health insurance provider and they will be paid less your deductible. However, most people DO NOT have a disability income policy to pay for their lost wages. And, there are no policies available to compensate you for your pain and suffering, that has to come from the Liability or UM coverage. Read between the lines and realize it’s not going to be a good situation for you in the near future. 

It’s Better To Be Safe Than Sorry

So, call your agent and find out first of all what your current UM limits are. Then, have them quote you the higher limits. You might be surprised how inexpensive the increased limits actually are.

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4 Responses to “Do You Really Need Uninsured / Underinsured Motorist Coverage?”

  1. Kathie wold Says:

    Thank you for the information–that was informative and valuable information to have.

  2. Christina Poodt Says:

    Thank you Glen, that was a scary story, even at 1.18 am

    I will check out what my coverage is, and see what I have to do about it. I may ask you to give me a quote as well. Thanks a ton for the info!!
    Drive Safe!!! Christina

  3. Anna Ighani Says:

    I recently changed my liability limits to the minimum amounts. I was thinking it was a good move to help save money and cut my budget. After reading your blog, I realize higher liability amounts are a modern world necessity. I will be increasing my liability limits and cut my budget somewhere else.

    Thank you for the dose of reality and helping to put in perspective where I should focus my priorities.

  4. Bonnie Collins Says:

    Thanks, Glen. Great explanation. Now I completely understand UM coverage. I did elect extra coverage when I received notification about this. How is coverage reflected on the dec page?

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