UM/UIM FAQs – Uninsured and Underinsured Motorist Coverage
As if being a victim of an auto collision wasn’t stressful enough, you find out the driver who crashed into you is uninsured. Texas law does require all drivers to be covered by liability auto insurance, however, not everyone follows the law and if they do, many drivers purchase only the minimum requirement of coverage.
According to the Texas Department of Insurance, an estimated 20 percent of drivers in Texas do not have insurance. That means there is a one in five chance any car collision will involve an uninsured driver.
What is uninsured or underinsured (UM/UIM) coverage?
This is a type of insurance coverage that pays for injuries and losses resulting from a collision caused by a driver that does not have any insurance or has too little insurance to cover all losses.
Having uninsured/underinsured motorist coverage(UM/UIM) would be beneficial in helping you and your family pay off medical bills in the event that the person who hits you does not have enough insurance or worse, they are completely uninsured.
You are not legally required to purchase uninsured/underinsured motorist coverage, however, the insurance provider does have to offer it to you. Many times the insurance agent will play down the fact that they have removed uninsured motorist coverage from your plan to get you a lower rate. Although it seems positive to have a more competitive rate, this also means many insured drivers are not protected from the 20 percent of the population driving uninsured.
What is the difference between an uninsured motorist and an under-insured motorist?
The difference is drastic. An uninsured motorist is someone who simply does not have any insurance. An underinsured motorist is someone who has insurance, but they don’t have enough insurance to cover the damages and losses they have caused. For example, a driver who causes a crash has the minimum $30,000 of injury coverage, but they crashed into someone and caused them injuries of $60,000, the driver will be considered underinsured.
What are the minimum insurance requirements in Texas?
In Texas, the minimum insurance requirements are $30,000 per person per incident up to $60,000. This means every driver is supposed to have an insurance policy which will pay someone who they injure up to $30,000. If there were passengers who were injured in the vehicle as well, they would be paid up to $60,000 divided between all the occupants of the vehicle. This does not seem like a lot of money if you were seriously injured and had to be hospitalized.
What happens if an uninsured driver hits me?
You do have the option to try and sue an uninsured driver. If the uninsured driver does not have enough to pay the settlement and does not have enough non-exempt assets such as a rental property, the case is going to be worthless. In most cases, a driver that hits someone and does not have insurance is not at-fault to pay since Texas makes the party at fault pay damages from their insurance.
Then who is at fault?
In Texas, your insurance company will become responsible for paying damages if an uninsured driver hits you. Keep in mind; your insurance company may try to offer a settlement lower than what you deserve in an attempt to minimize their losses.
What is the credit the insurance company is claiming for its other payments?
The insurance company is entitled to a credit if you make a personal injury protection(PIP) or medical payment (MedPay) claim. If your UM/UIM claim is worth $20,000, but your insurance company has already paid you $5,000 for PIP, then your insurance company has the credit of $5,000 and will only owe you $15,000.
If your claim exceeds the value of your policy limits, there will be an exception. For example, if your UM/UIM claim is worth $40,000, but your UM/UIM is only $30,000, the insurance company must pay the full $30,000 regardless if they already paid an amount for PIP or MedPay.
Does UM/UIM coverage apply to hit and run claims?
The answer is yes. However special rules are to be noted.
First, was it truly a hit and run? When it comes to UM/UIM coverage, just because the driver failed to stop, doesn’t make it a hit and run case for uninsured/ underinsured coverage purposes. If the person who didn’t stop is later tracked down, it does not fall under hit and run and the special rules will not apply.
On the other hand, if you were not able to track down the driver who didn’t stop, then your UM/UIM coverage does apply as long as there was contact. What does this mean? There must have been contact with your vehicle and the vehicle that didn’t stop. If the other driver ran you off the road, but your vehicles did not physically touch, then the coverage will not kick in.
Once it is determined that there was contact, you may file an uninsured or underinsured claim with your auto insurance carrier. Doing so will help you recover some lost wages and help pay your medical bills.
Why is an auto crash with an uninsured driver a big deal?
You are not protected if you are involved in a collision with an uninsured or underinsured driver. Often times after a car wreck, victims need to take time off from work to recover from their injuries causing them to encounter loss wages. In these situations, victims will be left in debt with medical bills and unable to recover for pain, suffering and other losses.
Is it easy to recover UM/UIM benefits?
Recovering benefits under your UM/UIM policy can be a complicated process. All too often, even after paying your premium for years, insurance companies are unwilling to compensate you for the full value of your injuries.
You will have to show that you are entitled to recover damages and justify the amount you are demanding. Just like with any other claim, the insurance company will try their hardest to settle your claim for as little money as possible even though it is your own insurance company.
How The Carlson Law Firm can help
If you were seriously injured in an auto collision and are seeking compensation under your UM/UIM policy, don’t hesitate to contact our experienced UM/UIM lawyers. Once it is determined that the coverage is in place, we will begin taking steps towards the burden of proof necessary to attain the coverage. We investigate claims thoroughly, using our extensive knowledge of the law and the insurance industry. Contact us today for a free case evaluation. We care, we can help.
- Written by Adriana Torres