Understanding Your Auto Insurance Policy – Uninsured Motorist Bodily Injury: Part 5 of 6

The next and last line that I want to point out to you on this policy is the uninsured motor vehicle bodily injury. It’s 100,000/300,000. You’ll notice that those are the same numbers of liability bodily injury insurance that was covered, and that’s usually how it’s sold in Virginia. If you get a 100,000/300,000 policy for the liability, you will also get that for uninsured and underinsured motorist coverage.

Now this is a very important part of your insurance policy. The reason it’s so important is that if someone hits you and causes you a significant injury and keeps you out of work for a good amount of time, and they don’t have any insurance, what are you going to do? Well without this coverage, you would simply have to get a verdict against the person that hurt you, but if they don’t make any money, or they don’t have any assets, you’re never going to collect anything. So this policy, this uninsured motorist coverage provides you coverage. Your insurance company steps into the place of the person who didn’t have any insurance, and your insurance company will pay the claim or the verdict against that person.

Now interestingly enough, your insurance company would pay you and then turn around and go try to collect the money from the person who caused the injury. But you must understand that just because it’s your insurance company does not mean that they are going to work with you and just agree with everything you say. You will be in an adversarial relationship with your insurance company, and I can assure you that they are going to work to pay you as little as possible. So that’s the uninsured coverage. The other is the underinsured coverage.

So, let’s give an example that someone runs into you, causes you a significant injury and your case is worth $125,000. Let’s say that the person that caused the accident only had $25,000 of insurance coverage, which is as we discussed the minimum in Virginia. So, their insurance company would pay $25,000, your insurance company would pay $75,000, getting you to a total of $100,000 in coverage and then the person that caused the injury would be responsible to you for the remaining $25,000.