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The Importance of UM/UIM coverage

Unfortunately, we live in a world where we cannot predict when the next accident will take place. Nor can we comprehend when ourselves or loved ones will be the victim of the negligent acts of another. While many times we cannot prevent a motor vehicle or trucking accident from occurring, there is one sure fire way to protect one’s self against financial disaster following an accident. That simple answer is UM/UIM coverage. UM/UIM coverage stands for Uninsured motorist/Underinsured motorist coverage. This type of insurance can be waived by any individual, but never should be. This particular type of coverage is applicable if you are even in an accident where the driver either has no insurance or is underinsured. Many times, UM/UIM coverage is the only insurance that is available when the other driver either flees the scene in a hit and run or falls within that 25% of Colorado drivers that do not have insurance. To illustrate this point further, let’s look at an example: Driver A is rear-ended by Driver B who carries the lowest Colorado policy limit of $25,000.00. Driver A has $150,000.00 in medical expenses and has no health insurance. In circumstances like this, the insurance company for Driver B is happy to tender a $25,000.00 policy limit to the Drive A. Likewise, if Driver A has a $25,000.00 UM/UIM policy, Driver A’s insurance company is happy to tender the full $25,000.00 as a full policy limit. That leaves Driver A will $100,000.00 in medical expenses and no other recourse for recovery. Now let’s assume that Driver A holds a $500,000.00 UM/UIM policy. Driver B’s insurance company would still render the $25,000.00 to Driver A, but now Driver A can make a claim up to $500,000.00 for not only his medical expenses, but also his pain and suffering, lost wages, physical impairment, and other harms and losses. Driver A’s decision to protect himself kept his financial well-being intact. The moral of this story is to investigate your own insurance coverage and find gaps that may harm you later. Look into your UIM coverage and increase that coverage as much as you can to at least $100,000.00 before an accident takes place. You will be surprised how affordable premium coverage is by most major insurance companies. Make sure to look out for your own safety in an unsafe world, you’ll be glad you did.