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Auto insurance is a legal requirement. In theory, that should mean that anyone you get into an accident with it has it. In practice, of course, lots of people drive without insurance, or without sufficient insurance.
There is an option to protect yourself, and that is uninsured/underinsured motorist insurance.
What is Uninsured/Underinsured Motorist Insurance?
Uninsured motorist insurance or uninsured motorist coverage is designed to cover medical and funeral expenses if you are involved in accident caused by:
- Somebody who is driving without insurance
- Somebody who leaves the scene of the accident and is never traced
- Somebody who’s insurance company denies coverage despite appeals
- Somebody who’s insurance company goes out of business
Of these, the most common situations are the top two, but hit-and-run accidents absolutely happen. This coverage is for medical bills, lost wages, compensation and funeral expenses. You may also be able to get underinsured motorist coverage, which covers you if you have expenses that exceed their coverage. Some states also let you buy uninsured motorist property damage, but typically collision coverage is a better deal as it covers you regardless of the cause of the damage.
How Does This Differ from Liability Insurance?
In many ways, it’s the reverse. Liability insurance covers you if you caused the accident (or are perceived as causing the accident). It pays the medical expenses of the third party.
In theory, if they cause the accident, their liability insurance covers you. However, if they don’t have it or don’t have enough, uninsured/underinsured motorist will cover your expenses.
Liability insurance is required by law in most states, although some entities self-insure (meaning they take the risk and pay the amount themselves). Uninsured motorist coverage is required in 20 states and Washington, D.C. Louisiana is not one of them, but the state does require that insurance companies offer coverage of at least 15/30 (15k per person, 30k per incident). Insurance companies are not required to cover property damage.
The Importance of Uninsured Motorist Insurance
So, how much do you need this coverage? The answer is: A lot. 1 in 8 motorists are currently driving without insurance. People can get away with this for quite some time, especially if they drive safely and carefully and don’t get pulled over.
You need uninsured motorist coverage because:
- It protects you from having to shell out money for an accident you did not cause. While health insurance will cover your medical bills, it won’t help with other expenses.
- It is not typically included in “full coverage” insurance and may be specifically waived. Even if you think you are covered in all cases, check your policy and see if you need to add uninsured/underinsured motorist.
- Unlike personal injury insurance, which covers you regardless of the cause, the premiums on uninsured motorist coverage cannot be raised after you make a claim.
- It offsets a high health insurance deductible, which can save you money over relying on your health insurance. It is also particularly useful if your health coverage is low quality.
- Some states have a particularly high number of uninsured drivers. Mississippi is the worst, as of 2022, with 29.4 percent of drivers being uninsured. Despite not requiring insurance, Virginia has a more average 10.5%. In Louisiana, the number is 11.7%, which is lower than average but still significant.
- Hit and runs, while rare, do happen, and are often covered. However, in Louisiana, you cannot use uninsured motorist property damage coverage to pay for a hit and run, so you should get full collision coverage.
- It provides benefits health insurance do not, such as pain and suffering compensation and money to cover lost wages or business income.
It also costs relatively little. While there are a lot of uninsured drivers out there, most accidents involve only people who have insurance. You aren’t as likely to need to make a claim as with other coverage.
Note that in states which require it you may also be required to get uninsured motorist property damage insurance, even if you already have collision coverage. Also, it is often a better deal to get both uninsured and underinsured coverage together.
How to Make a Claim
If you are involved in an accident with somebody who is uninsured, you should make a claim on this insurance. Louisiana is a comparative negligence state, so any damages awarded will be reduced by the percentage you are deemed responsible for the accident. This means you may also need to make a claim on liability insurance.
As already mentioned, you can’t claim on this coverage for a hit and run, such as if somebody damages your car in the parking lot and leaves. You can, however, make a claim for personal injury from a hit and run.
You should also file a police report. This is recommended for all accidents, but is particularly important if somebody is not insured. An uninsured motorist may be afraid of large personal liability and thus less likely to cooperate. You should also involve an attorney right away. Louisiana has one of the tightest statutes of limitations on personal injury in the country. It’s only one year, which leaves you no time to linger. The clock starts on the date of the accident.
Get medical attention even if you don’t think you are injured. Some injuries, such as whiplash, may not show symptoms for a few days after the accident. Record all medical bills and time off work and talk to your attorney. Insurance companies will often try to avoid paying, especially in complex cases where there might be multiple liability. Having an attorney often encourages them to settle rapidly.