Auto Insurance Part II: Uninsured Motorist (UM)

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Question: What is Uninsured or Underinsured Motorist [aka “UM”] insurance coverage? How much should we buy?

Short Answer: In short, UM coverage protects us against injuries, harms, and losses caused by negligent drivers who don’t carry any, or don’t carry enough, liability insurance adequately to compensate our losses from an accident. Limits are available in amounts up to the limits of liability coverage you purchase.

State Requirements: Driving is about THE most dangerous thing we do with our daily lives, and chances are likely we will be in more than one car accident. Chances are also pretty good that we will be in an accident with a driver who has failed to secure liability insurance altogether or who has a little liability coverage but not enough to pay for our losses.

So “UM”, also known as “uninsured” or “underinsured” motorist, insurance protects us in the unfortunate event that we ourselves are injured in an auto accident due to the mistake of someone who does not have any, or does not have enough, liability insurance to pay for our losses.

Because driving is so important to daily living yet can be so dangerous, Louisiana requires that automobiles be insured against “liability” [for more on “liability insurance,” see our previous post]. In contrast, the state does not require drivers or auto owners to buy UM insurance. But in order to issue a liability policy, the state does require auto insurers to provide UM insurance in an amount equal to liability limits, UNLESS we affirmatively decline or choose a lesser amount of UM insurance when we buy our policy.

Buying UM coverage is an additional cost. But the coverage is a relatively cheap addition to the liability premium. And if you are injured or killed in an accident by someone with no or only very little liability insurance, the extra protection provided by UM coverage – against the loss of income due to disability or death, the expense of health care or burial, and/or the pain, suffering, aggravation, and inconvenience of being injured and relying/imposing on others – may be priceless.

As a result of accidental injuries in which there is not enough insurance to compensate an injured person for their losses, the injured person can be transformed from a worker into a ward of the state. UM coverage helps to avoid that nightmare.

When it comes to what limits are available for UM coverage, the sky is the limit, though typically UM limits will not exceed liability limits. It is most important in our experience to carry enough UM insurance to protect your health and your wealth in the unfortunate event that you are injured in a major accident that severely injures you and you are no longer able to provide for yourself or others.

AS IMPORTANT as liability insurance is carrying the additional but relatively inexpensive coverage that protects you in the event you are injured by a negligent driver who has no insurance or not enough insurance to cover your losses. Consider buying some “UM”, “UIM”, “Uninsured motorist coverage”, or “Underinsured motorist coverage” to give you extra protection.

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