Understanding Uninsured Driver Accident Coverage

Unfortunately, car accidents happen. Now that winter is upon us, accidents are even more likely to happen. While having auto insurance to cover both yourself and anyone who may be put in harm by your driving is the law Massachusetts, there are a growing percentage of drivers who do not have proper insurance due to many reasons, but mostly in an attempt to save money. In the Massachusetts, you are required to carry uninsured motorist coverage. However, coverage for underinsured motorists is not mandatory. This article examines what uninsured and underinsured coverage is and whether or not you need both.

Uninsured Driver Accident Coverage

In the event that you were hit by an uninsured driver, and the accident is that driver’s fault, you should be covered by your “Uninsured Driver Coverage.” This will pay medical expenses, auto expenses, and help cover any lost wages during a period of recovery. It’s generally of no use to sue a person who does not have car insurance, because they probably do not have any money either. Instead, you would place a claim against your insurance company which could be up to the amount of your uninsured driver coverage limit.

Underinsured Driver Accident Coverage

A little more complicated situation is when the driver has insurance, but is underinsured. Again this would apply when you are hit by a driver with insufficient car insurance and the accident is deemed the other drivers fault. In this case, you make a claim against your own insurance company, but only if your insurance limit is higher than the negligent drivers.

An Example of Underinsured Driver Claims

Let’s say you have a case worth a total of $200,000, but the negligent driver has $100,000 coverage limit. If this happens, you can place an underinsured driver claim against your own personal insurer. Of course you need to have more than $100,000 in underinsured driver coverage. Say you had $150,000 in underinsured driver coverage, you could settle with the negligent driver for $100,000 (from their insurance) and then for $50,000 with your insurer. What you cannot do, is take the negligent driver’s $100,000 policy and then add another $100,000 from your own policy. You can only claim from your policy the difference that your policy is greater than theirs.

Also, keep in mind that uninsured and underinsured driver coverages cannot exceed the amount of your primary coverage. If you only have $100,000 in coverage for your own personal policy, you can only have up to the same amount ($100,000) in uninsured or underinsured coverage. The reason is that uninsured and underinsured coverage is very inexpensive compared to regular liability coverage, so insurance companies don’t want their customers beating the system by purchasing only the minimum liability coverage and then stocking up on uninsured and underinsured coverage.

Want to learn more about uninsured and underinsured driver coverage or about general auto insurance? Contact the H&K Insurance Agency in Watertown, MA today to learn more about auto as well as life and personal insurance. We can provide you with a free quote on these policies, or any other than may apply to you.