Coverage Protects You Against Uninsured Drivers
Have you ever looked at your insurance policy and wondered what these two lines mean?
- Uninsured/Underinsured Motorists Coverage Property Damage (UMPD/UIM-PD)
- Uninsured/Underinsured Motorists Coverage Bodily Injury (UMBI/UIM-BI)
It's not as it seems - you're not paying for coverage for people who can't afford it, you're paying to protect yourself. UMBI pays for your injuries, and UMPD, for your vehicle's damages if you're involved in an accident with another driver who either doesn't have insurance coverage or doesn't carry sufficient insurance to pay for the damage. It also kicks in if he or she commits a hit-and-run. For example:
Jack doesn't have insurance. He crashes into you, leaving you with $50,000 in medical bills and $15,000 in vehicle damages. Your policy's UMBI/UMPD would pay for both, up to its UMBI/UMPD limits.
You live in Iowa, which requires $15,000 per person/$30,000 per accident in bodily injury coverage, and $10,000 in property damage liability. Jack only carries state minimum liability limits. He crashes into you, resulting in $50,000 in your medical bills and $15,000 in vehicle damage. His policy would pay $30,000 of your medical bills, $10,000 towards your car's damage, and your UIM-PD/UIM-BI would pay the difference.
Always match UMBI/UMPD limits to your liability limits - don't insure someone else for more (or less) than you insure yourself.