Why You Need Uninsured Motorist Coverage to Protect Against Auto Accidents
Under Pennsylvania law, every motor vehicle liability insurance policy issued in the commonwealth must offer the option to purchase uninsured motorist (UM) and underinsured motorist (UIM) coverage. There is no requirement to purchase this coverage, and it does add to the cost of your policy. But there are many reasons to buy UM/UIM coverage, which can save you from severe financial hardship after a serious accident.
First, let’s understand how this insurance works. Pennsylvania law requires all drivers to purchase certain minimum levels of coverage:
- Personal injury protection —$5,000 in PIP to cover you and your passengers regardless of fault
- Bodily injury liability — $15,000 for one person and a total of $30,000 for all persons injured in a single accident if you are at fault
- Property damage liability — $5,000 if you are at fault
Suppose you sustain a serious injury in an accident and your medical bills amount to $100,000. You were smart enough to purchase more than the statutory minimum of insurance, so your PIP pays $25,000, but you have still lost $75,000. You file a claim against the other driver, who was at fault, but that driver only has the minimum required coverage of $15,000. Now you have a shortfall of $60,000. At this point, you can file a claim with your own insurance company under your UIM policy. If you have $25,000 in UIM, you can decrease your shortfall to $35,000.
You will still have to sue the at-fault driver to get a judgment for the total amount, plus your lost earnings and your pain and suffering. But at this point, if you have a good health insurance policy, your out-of-pocket losses should be manageable. Even if the at-fault driver doesn’t have a dime to pay a court judgment, you’ve avoided the worst-case scenario for financial hardship following your accident.
And, speaking of worst-case scenarios, it’s possible the at-fault driver has no insurance at all. The Insurance Information Institute estimates that about 12 percent of American drivers, and 6.5 percent of Pennsylvania drivers, carry no insurance, in defiance of the law. Imagine you’re hit by a drunk driver, driving on a suspended license without any insurance. Imagine the drunk driver is 24 years old, with no financial assets to pay a judgment. Without UM/UIM coverage, you’d only have your PIP and your health insurance to defray costs.
At our firm, we believe in carrying the maximum amount of insurance you can afford. When calculating your household budget, you should count UM/UIM insurance as a necessity, not a luxury.
If you have been injured in an auto accident caused by a negligent driver, Rudberg Law Offices, LLC can help. Call us at 412-488-6000 or contact our Pittsburgh office online to schedule a free consultation.