Jeffrey Johnson is a legal writer with a focus on personal injury. He has worked on personal injury and sovereign immunity litigation in addition to experience in family, estate, and criminal law. He earned a J.D. from the University of Baltimore and has worked in legal offices and non-profits in Maryland, Texas, and North Carolina. He has also earned an MFA in screenwriting from Chapman Univer...

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Laura Walker graduated college with a BS in Criminal Justice with a minor in Political Science. She married her husband and began working in the family insurance business in 2005. She became a licensed agent and wrote P&C business focusing on personal lines insurance. Laura serviced existing business and wrote new business. She now uses her insurance background to help educate drivers about...

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Reviewed by Laura Walker
Licensed Agent for 10 Years

UPDATED: Jul 14, 2021

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Car insurance is a mandatory requirement by law however this does not mean every driver has auto insurance.

In a perfect world everyone would have car insurance with enough coverage to pay for any damages or injuries in a car accident however we do not live in a perfect world.

There are millions of people driving with no insurance or limited coverage every day and if you happen to be unfortunate enough to get in a car accident with someone who doesn’t have any (or enough) auto insurance it can be very expensive.

Use our FREE quote tool to compare auto insurance rates today!

What is Uninsured and Underinsured auto insurance coverage?

Uninsured and Underinsured Motorist Coverage (also known as UM and UIM Coverage) provides financial protection against accidents against uninsured or underinsured drivers. This type of auto insurance is almost always an optional addition to your car insurance policy.

Who do I need Uninsured / Underinsured Motorist Coverage?

Very few drivers have psychic powers so its impossible to choose the people we happen to have a car accident with. While most drivers have satisfactory auto insurance that will cover damages for any minor accident there are still millions of drivers who have no insurance or are underinsured.

If you happen to be involved in a car accident with someone who does not have enough insurance (or any at all) you could be exposed to great personal liability. Consider incidents such as where the driver at-fault doesn’t have enough auto insurance to pay for damages to your vehicle.

Would you rather sue the driver and possible take years to recover the money or does it make more sense to have an additional type of insurance which will automatically kick in and pay the damages above and beyond the other drivers policy limits?

How about a hit and run accident? If someone damages your vehicle yet you have no idea who the other driver is how can you file a claim?

The accident was not your fault but you also don’t have a policy # for the other driver to file a claim. Uninsured motorist coverage would kick in here otherwise you would be left with the cost of repairing the vehicle yourself.

These are just two of the many examples of uninsured and underinsured motorist coverage which could happen to you.

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How many drivers have no car insurance or are underinsured?

Some states report the number of uninsured/underinsured drivers has reached over 30% and its not that far from unbelievable.

You will always have people driving with no insurance but in today’s economy people are also cutting back bills and opting for lower car insurance rates which can also lead to lower levels of coverage.

The fact is that every time you drive a vehicle there is a chance of being involved in a car accident where drivers do not have enough car insurance to cover the damages.

Is UM or UIM coverage mandatory?

Some states do require all drivers to obtain underinsured / uninsured motorist insurance but its only a very small list. You also want to check with auto insurance companies as some car insurers do not offer this type of coverage.

How much is Uninsured / Underinsured Car Insurance?

The cost of obtaining UM and UIM car insurance is actually very cheap but the cost of not having it can be exorbitant especially given the cost of vehicle repairs, medical expenses, car parts and every other expense that could result from a car accident.

Who has the best car insurance rates?

This is probably the most common question but there really is no definitive answer since auto insurance premiums are based on risk profiles and these risk profile are calculated differently by every insurance provider.

Its very important you understand the types of car insurance available and always compare at least a few auto insurance providers to find the best rates.

Use our FREE quote tool to compare auto insurance rates today!

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  1. What are the types of auto insurance?
  2. How does a car insurance deductible work?