uninsuredmoterist“UM” stands for Under or Uninsured Motorist. It’s a key part of any insurance policy that every driver should add. Even though most people think they have “Full Coverage,” they are missing UM protection. The costs for this coverage are usually minimal as well.

UM covers you if the at fault party involved in the accident is either NOT insured or is UNDERinsured.

What does this all mean?

Uninsured Example:

Andy and Betty have an accident and it’s Betty’s fault. Andy is injured and his case is worth $15,000. Andy has insurance and is covered with a policy of $15,000 to $30,000 Liability and $10,000 Collision (which is the legal minimum in California). However, Andy does not have Uninsured Motorists included in his policy. We find out that Betty does not have insurance and has zero assets.

Andy is out of luck and cannot recover anything for his injuries from Betty (since she has nothing), or from his own insurance. He only has liability coverage, which means he is covered for accidents that he causes.

Now let’s say Andy was covered by UM, and his UM limits were $50,000/$100,000. Andy would be able to recover the full value of his case through his own insurance policy.

Underinsured Example:

Andy is still covered by UM with limits of $50,000/$100,000. Now let’s say Betty does have Liability insurance with limits of $15,000/$30,000. Remember that Betty is responsible for the accident.

However, let’s say Andy is more seriously injured this time and his case is worth $45,000. Andy would be able to recover the full value of his claim through both his and Betty’s insurance. Andy will recover Betty’s policy limit of $15,000 and recover the balance of $30,000 from his own UM policy.

**Interesting fact: There are some cases where even pedestrians can recover money under their vehicle UM insurance policy, if they had an accident with a vehicle and the vehicle did not have insurance or was underinsured.

Contact Halpern & Associates today for more information on UM insurance and the possibility of how it applies to your case!