Does a Liability Only Auto Policy Need Uninsured Motorist Coverage?

In many states, a liability only auto policy is required to provide a certain level of protection for drivers who are involved in an accident with an uninsured motorist.

A liability only policy is designed to cover damages to other people or property in the event of an accident, but it does not provide coverage for the driver's own medical expenses or lost wages.

However, some states may require uninsured motorist coverage to be included with a liability only policy, even if the driver chooses not to purchase it.

This is because uninsured motorist coverage helps protect the driver from financial losses if they are involved in an accident with someone who does not have insurance.

Explore further: Will My Bodily Injury Cover Underinsured Motorist Coverage

You're considering a liability-only auto policy, but wondering if you still need uninsured motorist coverage. Nearly 13% of drivers nationwide don't have auto insurance, and in some states, the number is over 20%.

If you're involved in an accident with one of these drivers, you could be left paying for medical bills or vehicle repairs out of your own pocket. In fact, even if you file a claim against your own policy, you may have a large collision deductible or not have enough medical payments/personal injury protection to cover injuries.

According to the Insurance Information Institute, not having uninsured motorist coverage puts you at significant financial risk. This is because uninsured drivers often don't have the means to pay for damages or injuries they cause. In some states, all insurers must provide UM/UIM coverage in an amount equal to the policyholder's current level of liability coverage for bodily injury, unless waived in writing.

Some states may require a deductible for UM/UIM coverage, but not for UMBI/UIMBI. Here's a breakdown of what you might be covered for with UM/UIM coverage:

In some states, you can file a claim against your policy's uninsured motorist coverage even if the other driver is a hit-and-run driver. However, in these cases, you might need collision coverage to cover damage to your vehicle.

In some states, uninsured motorist coverage is mandatory to protect drivers from costs associated with accidents involving drivers with inadequate coverage. Connecticut, Illinois, and Maryland are just a few examples of states that require this coverage.

Uninsured motorist coverage is not required in all states, but driving without it can be a serious risk. Nearly 13% of drivers nationwide don't have auto insurance, according to the Insurance Information Institute.

Without uninsured motorist coverage, you could end up paying for medical bills or vehicle repairs out of your own pocket if you're injured or your vehicle is damaged in an accident with an uninsured or underinsured driver. In some states, the number of uninsured drivers is over 20%.

Uninsured motorist coverage is a must-have for liability-only auto policies, as it protects you from drivers with no or inadequate insurance. This coverage pays for your injuries and damages caused by a hit-and-run driver or a driver with no auto insurance.

Comprehensive and collision coverage, on the other hand, protects your vehicle from damage caused by other types of incidents, such as falling objects, fire, or theft. While not required by law, collision coverage may be necessary if you finance your vehicle.

Medical payments coverage is another essential type of insurance that can help cover medical expenses, including copayments or deductibles, for you and your passengers. This coverage is especially important if you don't have health insurance or if your health insurance plan has high deductibles.

The following types of uninsured motorist coverage are available:

Uninsured motorist coverage is a type of insurance that pays for the insured's bodily injury losses caused by a hit-and-run driver, a driver with no automobile insurance, or a driver of an underinsured vehicle.

In Colorado, this coverage is optional but must be provided by all insurers, unless waived by the policyholder in writing. This coverage takes the place of the insurance the other driver should have purchased, or protects the insured when the at-fault driver's vehicle is insured, but the bodily injury liability limits of his or her policy are less than the limits of the insured's UM/UIM coverage.

Intriguing read: Auto Insurance Medical Payments vs Bodily Injury

Uninsured motorist coverage does not protect the other driver, and it does not cover damage to the insured's vehicle. It pays for medical expenses, including copayments or deductibles, for the insured vehicle driver and passengers, regardless of fault, and can be purchased as part of an automobile insurance package.

In some states, uninsured motorist insurance may be separate, combined, or consist of up to four coverages: uninsured motorist bodily injury (UMBI) and property damage (UMPD) for drivers with no insurance, and underinsured motorist bodily injury (UIMBI) and property damage (UIMPD) for drivers with not enough insurance.

Here's a breakdown of what each of these coverages may pay for:

Note that some states may require a deductible for UMPD/UIMPD, but UMBI/UIMBI generally doesn't include a deductible.

Property damage caused by an uninsured driver can be a significant financial burden.

Depending on your state, uninsured motorist coverage for property damage (UMPD) may cover damages to both your car and other property, whereas collision coverage only pays for damages to your car, regardless of who is at fault.

If you live in a state where UMPD covers damages to other property, you may be able to recover costs for damages beyond just your car.

Collision coverage, on the other hand, will only pay for repairs to your vehicle, even if the other driver is at fault.

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Underinsured motorist coverage is available in some states to help protect you from at-fault drivers who cause a car accident and don't have enough insurance to pay for your injuries or damages.

This coverage is broken into the same categories as UM, which includes bodily injury and property damage.

In Colorado, UM/UIM coverage is optional, but it's a crucial protection against hit-and-run drivers, drivers with no insurance, or underinsured vehicles.

This coverage takes the place of the insurance the other driver should have purchased, or protects the insured when the at-fault driver's vehicle is insured, but their bodily injury liability limits are less than the insured's UM/UIM coverage.

The law requires all insurers to provide UM/UIM coverage equal to the policyholder's current level of liability coverage for bodily injury, unless the policyholder waives it in writing.

If you reject UM/UIM coverage, you may opt to carry a lower level of coverage or reject it completely.

In a hit-and-run accident, UM/UIM coverage pays for the insured's bodily injury losses, but it doesn't protect the other driver or cover damage to the insured's vehicle.

Medical payments coverage can also be purchased as part of an automobile insurance package, paying for medical expenses, including copayments or deductibles, for the insured vehicle driver and passengers, regardless of fault.

Suggestion: Bcbs Medical Policy Guidelines

As a driver, it's essential to understand the risks of being involved in an accident with someone who doesn't have car insurance. Uninsured motorist coverage is designed to protect you in such situations.

If you're injured by someone who doesn't have car insurance, Uninsured Motorist Bodily Injury (UMBI) coverage can help cover medical expenses, funeral expenses, loss of income, and pain and suffering.

You can buy uninsured motorist coverage with minimum limits of 25,000/50,000 or up to the limits of your policy, or any value in between.

This type of coverage pays for medical care or provides compensation for the loss of life suffered by you or your passengers in a collision involving a driver without sufficient insurance.

Without UMBI coverage, you could be held responsible for paying your own medical expenses, which can be a significant financial burden.

Here's an interesting read: Is Medical Payment Coverage Needed for Auto Insurance