Do I need underinsured motorist coverage?

As a former auto claim adjuster, un-insured and under insured motorist is one of the BEST and cheapest to buy, and under NO circumstances, would I ever drop either of them.

Unknown what state you live in, but in my state, (Indiana), the limits are 25/50/25. Now the last number is car damages and the 1st number is MAX per person for injuries and the 2nd (50) is MAX for 2 or more people.

With an injury settlement, they REIMBURSE you for medical bills, lost wages and then add pain/suffering.

Most states have medical payment coverage, which most people purchase with anywhere from $1,000 to $10,000 max on average. In some states it is PIP, which works like health insurance in some cases, but there is also a maximum they pay, and could pay lost wages, and also have a deductible/co-insurance with some, and others don't, varies by state.

If, you have injuries, the PIP or med pay will pay for all medical treatment related to the accident, (up) to the limits. Once the limits are paid, then health insurance, since secondary, would then come in and pay, once the other is exhausted. But, if the at faults or your insurance company denies, it is because they feel it is not medically necessary, or car related, so your own health insurance would pay or not pay, per your contract with them.

With any settlement, WHOEVER pays, be it your auto insurance PIP or med pay, or, if your health insurance pays, then they MUST be reimbursed from the settlement and would have a lien.

What if you have a serious injury and need surgery? Or a long hospital stay? Or, need a lot of physical therapy after the accident to regain the use of your arms/legs?

So, now look again at the $25,000. This maybe not enough to pay off the medical bills. With most health insurance today, most of us have high deductibles we pay before insurance pays. Then that co-insurance adds up (80/20), so every bill you pay out of pocket 20%.

So, say you have $30,000 in medical bills. If you have under insurance which should be a MINIMUM or double, or 50/100, so then 1st at fault settles for $25,000 and then YOUR insurance company under the UNDER insurance settles with you for $50,000, so after paying off the medical bills of $30,000, you get $20,000 for pain/suffering. With NO under insurance, you get $25,000, pay the medical bills, and still owe them $5,000 not paid by insurance.

After settling injury claims for over 10 years, I now have over $500,000 in coverage, since I have seen over the years, that the minimum amount (legal) is many times is not enough, and you end up paying, vs the other fault driver does.

Get the picture?

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