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What Your Insurance Agent May Not Be Telling You About Your Uninsured & Underinsured Motorist Policy

What happens if you are injured in an auto accident, but the other driver, who caused the accident, doesn’t have enough liability coverage — or any auto insurance— and can’t pay for your injuries?  You are not out of luck: your insurance company should help you.  When your uninsured/underinsured motorist coverage applies and should help compensate you for your injuries.


What is Uninsured Motorist (UM) Coverage?

An uninsured motorist (UM) policy provides that you and your passengers will receive compensation for injuries caused by a negligent, uninsured driver.  It is found to some degree in most U.S. automobile insurance policies.  UM, coverage is generally mandated by statute, up to $30,000 per person and $60,000 per accident for any bodily injury or property damage coverage policy.   It will pay for your injuries if the other driver is uninsured and legally responsible for the accident.

What is Underinsured Motorist (UIM) Coverage?

An underinsured motorist (UIM) policy provides that a covered person will receive compensation due to an injury caused by a negligent, underinsured driver.  UIM coverage will apply and provide additional payment if the responsible driver has liability coverage but not enough to compensate for your bills associated with such injuries.

Why is it important?

In the case of an accident, you and your passengers need to be protected against the negligent motorist.  North Carolina requires that all drivers carry uninsured (UM) coverage only and then only up to $30,000 per person, $60,000 per accident.  So while you have at least some protection, this is often not nearly enough coverage.  We recommend that you have $1 million of UM/UIM coverage on your policy to protect you and anyone riding with you.

What does UM/UIM coverage pay for?

You can benefit from your UM/UIM policy and receive compensation for such things as the following:

  • Medical bills
  • Lost wages
  • Pain and suffering

Who qualifies as a UM/UIM?

The negligent driver may be considered an “uninsured motorist” if they do not have liability coverage or have not been paying their premiums, and therefore, their policy has lapsed.  The negligent driver may be considered an “underinsured motorist” if they don’t have enough liability coverage to compensate for your or your passengers’ injuries.

How does your UM/UIM coverage work?

Say you are in an accident and your leg is broken.  Your medical bills alone are $40,000, and the driver at fault is an uninsured or underinsured motorist.   You will need to file a claim under the UM/UIM section of your policy to receive compensation.  Your insurance company will be responsible for paying for your injuries, up to the amount of your UM/UIM coverage.  The amount of UM/UIM coverage varies, which means your insurance company may not pay for the whole lump sum.  In North Carolina, UM/UIM coverage generally comes in the following amounts, but the amount offered may differ depending on the insurance company providing range:

  • 30/60 – $30,000 per person/ $60,000 per accident
  • 50/100 – $50,000 per person/$100,000 per accident
  • 100/300 – $100,000 per person/$300,000 per accident
  • 250/500 – $250,000 per person/$500,000 per accident
  • $1 million – $1,000,000 per person or accident

If your policy provides 30/60 coverage in the above scenario, you would only be compensated for $30,000 and left with a debt of $10,000 that you may have to pay yourself.  We advise that you carry $1 million of UM/UIM coverage to ensure as much protection as possible for yourself and your family.   You will be surprised how little $1 million of UM/UIM coverage costs, especially when compared to the benefit of having this amount of protection should you need it.

If you have questions about what is best for you and your family, do not hesitate to contact us.  Being injured and worried about your medical bills and lost wages can be a headache.  We may be able to help you receive just compensation from your insurance company or give you advice about what to do next in your case.  Call or visit our website today for a free consultation, and let Kelly & West protect you.


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