Do I Need Uninsured/Under Insured Driver Coverage?

The consequences of being hit by an under insured/uninsured driver depend on your state's insurance laws. States are either "no-fault" or "tort" as far as insurance  goes.

In no-fault states, drivers go to their own insurance company for payment after an accident. The question of who is at fault isn't usually even discussed.

In tort states, car insurance companies pay for damages based on who is at fault. So if you're in an accident where the other driver is deemed completely at fault, their company would have to cover all damages — yours and their own.

As you can see, colliding with an uninsured or under insured driver is a simpler matter in a no-fault state: You simply file a claim with your car insurance company and they handle your needs.

However, you might still want to consider uninsured/under insured motorist coverage if you live in a no-fault state due to the extra financial protection it provides.

 For instance, if you're hit and injured in a collision with an uninsured driver, your health insurance will pay your medical bills — but they won't help you with lost wages or pain and suffering compensation, things the other driver's liability policies would normally provide. Thankfully, uninsured/under insured coverage can help.

If the crash happens in a tort state,  you may have to sue for damages — hence the "tort." This can be a costly and stressful process.

Taking into account that an uninsured or under insured driver probably lacks insurance due to limited funds, chances of payment is pretty slim.

Your own policy will of course cover you, but only up to your selected limits. If your limits are too low to cover all costs, you'll have to choose between paying out of pocket or litigating.

Note that some states have "contributory negligence" laws, which mean that insurance companies pay claims based on degree of fault. So if you're deemed to be 21 percent at fault in a collision, your insurance company will pay 21 percent of damages.

In closing, getting that extra coverage may seem like an unnecessary expense at the time, but in the event that you are involved in an accident with an under insured/uninsured motorist, you will be glad you have the coverage should your expenses exceed their coverage.

Check with your Insurance Agent to see if you are fully protected in the event of an accident with an under insured/uninsured motorist.