What is uninsured motorist coverage?

Q:

What is uninsured motorist coverage? Is it important?

A:

The term "uninsured motorist coverage" is one of those rare cases in the insurance industry where the name really does say it all. This coverage is usually bundled into your basic automobile insurance coverage and it provides protection against accidents where the at-fault driver is a motorist who does not have valid automobile liability coverage. This simply means a motorist who doesn't have insurance in force or has somehow not validated their insurance coverage. The uninsured motorist deductible on a policy is almost always the same as the collision deductible (learn about The Pros and Cons of Increasing Your Auto Deductible).

This coverage might seem like a waste of money. After all, everyone carries insurance, right? But the risk is greater than you might realize. Drivers can become "uninsured" in a variety of ways. Some of the most common ones are:

With all these ways of becoming uninsured, don't be surprised if your uninsured motorist coverage has to kick in if you ever get into an accident.

We should also discuss underinsured motorist protection and unidentified motorist protection. These two are usually sold alongside uninsured motorist coverage as part of your basic coverage (depending on your jurisdiction). As you might have guessed, under-insured motorist coverage will protect you against drivers who have liability insure but don't carry enough of it to adequately compensate you for damages, and unidentified motorist protection provides coverage against hit-and-run incidents in which the other party cannot be identified and located.

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Written by Jacques Wong
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Jacques grew up around the insurance industry and began actively participating in 2013. Since then, he has gotten a Level 2 license, won an Insurance Council of BC award in 2015 for academic excellence in the insurance licensing courses and educates insurance professionals through PNC Learning.   Full Bio