What Is Underinsured Motorist Coverage and When Can I Use It?

Car accidents are terrifying. From damage to your vehicle to missed workdays and mounting medical bills, the situation can feel overwhelming, especially when you’re in pain. What makes it worse is discovering that the at-fault driver doesn’t have enough insurance to cover your injuries. It’s frustrating and disheartening to hear.

However, there’s a type of insurance you can purchase to protect yourself in such situations: underinsured motorist coverage. This coverage, though not required in most states, is an additional form of protection that can help when the other driver’s insurance falls short.

How Does It Work?

Let’s imagine you’re in a serious car accident, and your medical bills total $50,000. The at-fault driver only has the state minimum insurance of $25,000. That won’t cover your expenses, let alone any compensation for pain and suffering. This is where your underinsured motorist coverage steps in to bridge the gap, ensuring that you are covered for the remainder of your costs. It’s a valuable add-on that helps supplement insufficient coverage from other drivers.

When Should You Use Underinsured Motorist Coverage?

There are several scenarios where underinsured motorist coverage proves to be essential:

1. The at-fault driver doesn’t have enough insurance.
   This is the most straightforward use of underinsured motorist coverage. For instance, in Missouri, the minimum required insurance is $25,000 per person and $50,000 per accident. Many drivers only carry this minimum, which may not be enough to cover serious injuries. In fact, it might not even cover emergency room care.
2. You have significant medical bills.
   Car accident injuries can require costly treatments such as medical tests, physical therapy, or even surgery. If the at-fault driver’s insurance doesn’t cover these expenses, underinsured motorist coverage can help fill the gap and ensure you’re not left paying out-of-pocket for your treatment.
3. You’re unable to work for an extended period.
   Serious injuries may require you to take time off work, resulting in lost wages. Underinsured motorist coverage can help cover some of your financial losses while you recover.
4. Multiple people were injured in the crash.
   When several people are injured in the same accident, the at-fault driver’s insurance has to be split among the victims, potentially leaving you with a smaller share. This is common in multi-car accidents or when multiple passengers are involved. Underinsured motorist coverage can help ensure you get the compensation you deserve.

What to Keep in Mind When Using Underinsured Motorist Coverage

Before you can access this coverage, there are a few important details to be aware of:

1. All available coverage must be exhausted first.
   Whether you’re the only claimant or part of a group of claimants, the at-fault driver’s insurance must be completely exhausted before your underinsured motorist coverage will kick in.
2. Approval may be required from your insurance carrier.
   Some insurance policies require you to get approval before accepting a settlement from the at-fault driver’s insurance. This ensures that you can still use your underinsured motorist coverage afterward.
3. Policy stacking may be an option.
   In some states, including Missouri, if you have underinsured motorist coverage on more than one vehicle, you may be able to “stack” the policies. This means your insurance company could pay out on all of your underinsured motorist policies, which can increase your total available coverage. However, your stacked coverage may be limited to the state’s minimum requirements, depending on your policy language.
4. Your passengers may be covered as well.
   If you were a passenger in a crash, the underinsured motorist coverage from your driver’s insurance might cover your excess damages if the at-fault driver’s insurance is inadequate.

Understanding Insurance to Protect Your Rights

Knowing how your insurance works is crucial if you’ve been injured in an accident. Underinsured motorist coverage can make a significant difference in whether you receive full compensation for your injuries.

At Siegel Injury Law, our experienced personal injury attorneys can help you understand your coverage and guide you through the claims process. If you have questions about underinsured motorist insurance or want more information about the coverage you should have, contact us for a free consultation.