Understanding Uninsured and Underinsured Motorist Coverage

According to the Georgia Department of Public Health, motor vehicle crashes are the second leading cause of injury deaths and second leading cause of hospitalizations and ER visits statewide. It’s no wonder! Georgia Department of Transportation figures show that 384,527 automobile accidents occurred on Peach State roads in 2022, causing 1,844 fatalities. Despite the troubling statistics, while most drivers carry insurance to protect themselves and others on the road, not everyone is as responsible. Understanding the importance of Uninsured and Underinsured Motorist Coverage can help safeguard your financial well-being in the event of an accident.

The Alarming Rise of Uninsured Motorists

Georgia has witnessed a concerning increase in the number of uninsured motorists on its roads in recent years. Despite state laws mandating auto insurance, some 12 percent of Georgia’s more than 7.6 million drivers (10th highest in the nation) operate their vehicles without any insurance, leaving the rest of the road users vulnerable in the event of an accident.

When an uninsured motorist is involved in an accident, the consequences can be financially devastating for the innocent party. Without insurance to cover medical bills, property damage and other expenses, the burden often falls on the victim. This is where Uninsured Motorist (UM) coverage becomes crucial. As the name suggests, UM coverage protects you when you are involved in an accident with a driver who does not have insurance. This coverage kicks in to compensate for medical expenses, property damage, and other losses that the at-fault, uninsured driver cannot cover.

In Georgia, UM coverage is not mandatory, but insurance companies are required to offer it to policyholders. Drivers can choose to accept or reject UM coverage, but considering the high number of uninsured motorists on the road, it is a prudent choice to include it in your policy. Here’s why…

The Importance of UM Coverage

Protection Against Uninsured Drivers: UM coverage acts as a safety net, providing financial protection in the unfortunate event of a collision with an uninsured motorist. Without this coverage, you might find yourself left with hefty bills and no means of reimbursement.

Hit-and-Run Accidents: Hit-and-run accidents, where the at-fault driver flees the scene, are unfortunately common. In such cases, identifying the responsible party can be challenging. UM coverage steps in to cover your expenses when the at-fault driver is unknown or cannot be located.

Underinsured Motorist Coverage (UIM): In addition to uninsured motorists, there is also the risk of being involved in an accident with a driver whose insurance coverage is insufficient to cover your damages. Underinsured Motorist Coverage (UIM) comes into play in such scenarios, providing the necessary financial support to bridge the gap between the at-fault driver’s coverage and your actual expenses.

Understanding Underinsured Motorist Coverage

Underinsured Motorist Coverage (UIM) complements UM coverage by offering protection when the at-fault driver’s insurance is inadequate to cover your losses. Like UM coverage, UIM is not mandatory in Georgia, but insurance companies are required to offer it to policyholders.

The Importance of UIM Coverage

Protection Beyond Basic Liability: While Georgia requires drivers to carry liability insurance, the minimum coverage may not be sufficient to cover extensive medical bills and property damage in the event of a serious accident. UIM coverage ensures that you are adequately protected when the at-fault driver’s insurance falls short.

Medical Expenses and Lost Wages: A significant accident can result in substantial medical expenses and time away from work. UIM coverage helps cover medical bills, rehabilitation costs, and lost wages, ensuring that you can focus on recovery without the added stress of financial strain.

Comprehensive Coverage for Various Scenarios: UIM coverage is versatile and can apply to various scenarios, including accidents involving underinsured drivers, pedestrians or cyclists. This makes it a valuable addition to your auto insurance policy, providing comprehensive protection for a range of situations.

Tips for Choosing the Right UM/UIM Coverage Limits

While understanding the importance of Uninsured and Underinsured Motorist Coverage is crucial, selecting the right coverage limits is equally important. Here are four top tips to help you make an informed decision:

  1. Evaluate Your Risk Tolerance: Consider your personal tolerance for risk and financial exposure. If you prefer more comprehensive coverage and are willing to pay a slightly higher premium, opt for higher UM/UIM coverage limits.
  2. Assess Your Budget: Evaluate your budget and determine how much you can comfortably afford in terms of premiums. While higher coverage limits provide more protection, it’s essential to strike a balance that aligns with your financial capabilities.
  3. Consider Medical Costs and Property Values: Take into account potential medical costs and property values when selecting UM/UIM coverage limits. Consider the average cost of medical care and property repairs in your area to ensure your coverage adequately protects you in the event of an accident.
  4. Factor in Existing Health Insurance: If you already have comprehensive health insurance, you may choose lower UM coverage limits, as your health insurance can cover some medical expenses. However, keep in mind that UM coverage extends beyond medical costs to include property damage and other losses.

Protecting yourself from the financial aftermath of an auto accident is paramount. Uninsured and Underinsured Motorist Coverage provides a safety net, ensuring that you are not left shouldering the burden of someone else’s negligence. As the number of uninsured motorists continues to rise, making the wise choice to include UM and UIM coverage in your policy is a proactive step towards safeguarding your financial well-being on the road. Take the time to assess your risk, budget, and coverage needs to make an informed decision that aligns with your priorities and provides the peace of mind you deserve on Georgia’s highways.

But don’t stop there. Even if you’re insured to the hilt, in the event you or a loved one are injured in an automobile accident, you don’t want to risk going head-to-head with an opposing insurance company without the guidance of an experienced auto accident attorney. Understanding insurance laws can be overwhelming and insurers on both sides of often simply want to close a case quickly so they can move onto the next. Having a lawyer advocate for you can help assure you get the full compensation due. Contact Douglas, Georgia’s Farrar Hennesy and Tanner at 912-384-2287 or request a free case review and virtual legal consultation online today.