Understanding Um Bi: Auto Insurance Essentials

Uninsured Motorist Bodily Injury (UMBI) insurance covers your injuries and medical bills if you're hit by a driver with no insurance or not enough insurance. It also covers your passengers' injuries and medical bills. UMBI is mandatory in many states and can be added to your policy as an optional endorsement in others. UMBI is different from Bodily Injury (BI) insurance, which is a component of liability insurance that covers the injuries and medical expenses of other drivers if you are at fault in an accident.

Uninsured motorist bodily injury (UMBI)

In the unfortunate event of an accident with an uninsured driver, UMBI coverage can help cover the costs of medical treatments, pain and suffering, and other injury-related expenses. This protection ensures that you don't have to pay for these expenses out of pocket or rely solely on your health insurance, which may have higher deductibles or limited coverage for injuries sustained in a car accident.

UMBI coverage is especially useful if you're in an accident with a driver who has no insurance at all. However, it's important to note that this coverage typically does not include a deductible, which means you won't have to pay anything out of pocket when making a claim. Additionally, UMBI can provide coverage if you're injured by a car as a pedestrian, offering comprehensive protection for various scenarios.

While UMBI coverage is mandatory in many states, it is optional in others. Even if your state doesn't require it, it's highly recommended to consider adding UMBI to your auto insurance policy. Without this coverage, you could be left financially vulnerable if you're in an accident with an uninsured driver. The peace of mind that comes with knowing you're protected makes UMBI coverage a valuable addition to your auto insurance.

When determining the appropriate amount of UMBI coverage, it's generally advisable to match the limits of your liability coverage. By doing so, you ensure that you have the same level of protection for yourself and your passengers as you would provide for others in the event of an accident.

Uninsured motorist property damage (UMPD)

UMPD covers repair costs to fix your car and any extra costs if the other driver doesn't have enough property damage liability insurance. It can also cover damage to your home or other property. This type of insurance is useful if you don't have collision insurance for your car, as it can help pay for repairs if the costs exceed the other driver's property damage liability limits.

The main difference between UMPD and collision coverage is that UMPD only covers damage caused by a driver with little or no insurance, while collision coverage applies to any collision with another vehicle or object, regardless of fault. UMPD generally has a lower deductible than collision coverage and may be cheaper overall, especially if you have an expensive car.

If you live in the District of Columbia or the following US states, your insurer is required to offer you UMPD:

• Maryland
• New Hampshire
• North Carolina
• South Carolina
• Vermont
• Virginia
• Washington
• West Virginia

In Illinois and Utah, you can only purchase UMPD if you don't already have collision coverage.

Underinsured motorist bodily injury (UIMBI)

UIMBI coverage comes into effect when the at-fault driver's insurance policy limits are insufficient to cover the full extent of your medical expenses and other damages. This can include lost wages if you're unable to work due to your injuries, as well as compensation for pain and suffering. By having UIMBI, you can ensure that you and your passengers receive the necessary financial support to cover medical treatments and other related costs.

It's important to note that UIMBI is not mandatory in all states, but it is highly recommended for all drivers. In some states, such as Illinois, both uninsured and underinsured motorist coverage are required by law. Even in states where it's not mandatory, it's a prudent decision to include UIMBI in your auto insurance policy. This is because it provides additional protection in the event that the at-fault driver's insurance coverage falls short, ensuring that you're not left with overwhelming financial burdens.

When purchasing UIMBI, it's advisable to consider matching the coverage limits with your liability coverage. This means that if your liability limits are $50,000 per person and $100,000 per accident, you would opt for the same limits for your UIMBI coverage. By doing so, you can maximize your financial protection in case of an accident involving an underinsured driver.

In conclusion, UIMBI is a vital component of auto insurance that can provide peace of mind and financial security. By understanding the importance of UIMBI and including it in your policy, you can ensure that you and your passengers are adequately protected in the unfortunate event of a collision with an underinsured motorist.

Underinsured motorist property damage (UIMPD)

UIMPD is usually offered alongside underinsured motorist bodily injury (UIMBI) insurance, which covers the cost of any injuries sustained in a crash with an underinsured driver. While UIMPD covers the cost of damage to your vehicle, UIMBI covers medical bills for both you and your passengers.

In some states, UIMPD is mandatory, while in others it is optional. For example, Maryland requires UIMPD with a minimum coverage of $15,000, while in New Hampshire, drivers are not required to have car insurance, but if they do, a combined UIMPD and UMPD coverage of $25,000 is mandatory.

If you already have collision coverage, UIMPD may not be necessary, as both types of insurance cover damage to your vehicle caused by an underinsured driver. However, UIMPD generally has a lower deductible than collision coverage and may also cover damage to property other than your vehicle.

UM/UIM coverage limits

In some states, UM and UIM coverage limits are required to match the policyholder's liability coverage limits. This means that if you have liability coverage limits of $100,000 per person and $300,000 per accident, your UM and UIM coverage limits would also need to be $100,000 per person and $300,000 per accident.

It's important to note that UM and UIM coverage limits are typically separate from property damage coverage limits. Property damage coverage pays for repairs to your vehicle or other property damaged in an accident. This type of coverage usually has a single limit, such as $10,000, which is the maximum total payout for all property damaged in a single accident.

When choosing UM and UIM coverage limits, it's important to consider your own financial situation and the cost of medical care and vehicle repairs in your area. It's generally recommended to have enough coverage to protect yourself from paying large amounts out of pocket if you're in an accident with an uninsured or underinsured driver.

Frequently asked questions