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The Importance of UIM (Underinsured Coverage) on Your Auto Insurance Policy

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January 8, 2013 by jimspearslaw

Why do I need UIM (Underinsured coverage)?
Underinsured coverage applies to you or any person in your vehicle if you are involved in an auto accident and the at-fault party does not have enough liability insurance coverage to pay for your medical bills and damages. This coverage is usually fairly cheap, but unfortunately most agents do not inform their customers of the coverage of how it works.

For example: John Doe pulls out from a stop sign and runs into your vehicle. Doe only has $25,000 in liability coverage. Your bills and lost wages total $30,000. His insurance policy would only have to pay a maximum of $25,000, no matter how high your bills are or how badly you were hurt. If you had underinsured coverage, you could collect on your policy up to the UIM policy limits. Not only could you collect, but your passengers could collect also.

If you are in a wreck while driving one of your insured vehicles and you have UIM coverage on the car involved in the wreck and on additional household vehicles, you could potentially collect the UIM on your vehicle in the wreck as well as on your other vehicles. The total amount you can collect would depend on the amount of your damages.

Check your policy or your most recent car insurance bill. If you do not have UIM coverage, call or visit your insurance agent and tell him you want to add it to your policy. UIM coverage is cheap and really pays off if you are in a bad wreck. If you have questions about this coverage, give Jim Spears Law a call, or bring a copy of your most recent auto insurance bill or policy by the office. We will be glad to review it for you.

Under South Carolina law, all vehicles must be insured with liability and uninsured motorist coverage. UIM coverage is optional, but must be offered by the insurance carrier.

What if I have full coverage auto insurance? Does that include UIM?
Clients frequently tell me that they have “full coverage” auto insurance. That normally means that they have the minimum required coverage under South Carolina law. You should strongly consider adding UIM (underinsured motorist coverage) and med-pay or PIP coverage if offered by your auto insurance company.

What is Med-pay or PIP coverage?
Med-pay coverage is insured on your homeowners or auto policy that will pay for medical bills if you are involved in a wreck (auto) or if a guest is injured at your home or on your home property. Many auto insurance companies do not offer this coverage. However, I suggest you ask your carrier. If they offer med-pay coverage you should strongly consider adding it to your policy. Even if you are at fault in a wreck, you can collect this coverage to pay for accident-related medical bills up to the policy limit.

PIP, or Personal Injury Protection, coverage was required to be offered in South Carolina until the late 1980s, when legislature repealed the mandatory offering statute. PIP covers lost wages as well as medical bills from a wreck. Just like med-pay, you can collect this coverage even if you are at fault in a motor vehicle accident. This also applies to passengers in your car with you at the time of the wreck. Most auto insurance carriers no longer offer this coverage.

If you have questions about Underinsured Motorist Coverage, Med-pay, or PIP coverage, contact Jim Spears Law today.

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