What is UIM and UM Insurance?
UIM and UM are abbreviations for a type of automobile insurance policy that provides benefits when another driver does not have enough insurance. UIM stands for under insured motorist coverage; UM is an abbreviation for uninsured motorist coverage. In California, all automobile insurance companies are obligated to offer UIM and UM coverage. However, California does not require every motorist to obtain these benefits. Over the years, we have noticed that many clients either do not know about this insurance benefit or pay for this benefit without understanding how it works. Here, we explained the basics of these two coverages that you can consider obtaining the coverage or seeking benefits under the coverage.
UM Coverage Applies When The Other Party Is Uninsured
Uninsured motorist coverage provides benefits when the at fault party does not have insurance. In California, every automobile is obligated to carry liability insurance. Despite this law, many motorists ignore this requirement. This means that there are many motorists in California who operate vehicles without insurance. To protect people from uninsured drivers, insurance companies offer UM coverage. UM benefits apply when the at fault party does not have insurance. UIM coverage also applies when the at fault party cannot be found.
For example, if you are rear ended by a driver who does not have insurance, then you can seek benefits under UM coverage. Or if another driver hits your vehicle and then runs away, you can also seek benefits under uninsured motorist coverage. To seek these benefits, you have to make a claim to your own automobile insurance.
UIM Coverage Applies When The Other Party Is Uninsured
Even if a driver has insurance, it may not be enough to cover your injuries. In California, motorists are required to carry at least $15,000 in bodily injury liability insurance. Unfortunately, the value of personal injury claims often exceed this minimum. As such, insurance companies offer UIM coverage. UIM coverage provides benefits beyond the at fault driver’s liability insurance limit. For example, let’s assume another driver collides against you, resulting in medical bills exceeding $50,000. If that driver only has a $15,000 bodily injury liability insurance, then you are only entitled to recover 15,000 from the at fault driver’s insurance policy. However, if you have UIM coverage of $50,000, then you can recover benefits under your own insurance carrier.
To obtain benefits under UIM coverage, the at fault driver’s policy must first be exhausted. After the policies exhausted, then you could be entitled to benefits under your own policy. The amount of money that you are entitled to under UIM coverage depends on the UIM policy limits and the amount of damages you have incurred.
Who Benefits From UM and UIM Coverage?
UM and UIM insurance provides benefits to key benefits: 1) protect you from drivers who don’t have enough insurance and 2) protect family members who live with you from drivers who do not have enough insurance.
This type of insurance provides independence from relying on the at fault driver’s insurance policy limit. While no one wants to be involved in an injury, preparing for the ideal protection is important. Without UM or UIM coverage, injury victims rely on the negligent person’s own insurance. If the negligent person does not have enough insurance, and the injury victim cannot be fully compensated. As such UM and UIM insurance provide peace of mind that if a tragic accident occurs, then you will have better insurance.
The other benefit from these two coverages is that it applies to family members who live with you. For example, this coverage will apply to uninsured brother if the brother is injured by someone who does not have enough insurance. It does not matter if the brother is named as uninsured under the policy. What matters is whether the brother lived with the insured at the time of the accident.