You do everything right behind the wheel. You obey traffic laws, maintain safe following distances, and carry auto insurance. But what happens when the driver who hits you has no insurance at all, or does not carry enough insurance to cover your medical bills and lost wages? In Pennsylvania, uninsured motorist (UM) and underinsured motorist (UIM) coverage provides a critical safety net for exactly these situations. Understanding how this coverage works can make a tremendous difference in your financial recovery after an accident.
What Is Uninsured Motorist Coverage?
Uninsured motorist (UM) coverage is a component of your own auto insurance policy that protects you if you are injured by a driver who has no liability insurance. Despite Pennsylvania’s legal requirement that all drivers carry auto insurance, studies consistently show that a significant percentage of drivers on the road are uninsured. UM coverage steps in to cover your medical expenses, lost wages, and pain and suffering when the at-fault driver has no insurance to pay your claim.
UM coverage also applies in hit-and-run accidents where the at-fault driver cannot be identified. Without UM coverage, victims of hit-and-run accidents often have no way to recover compensation for their injuries beyond their own medical insurance, which does not cover pain and suffering or lost wages.
What Is Underinsured Motorist Coverage?
Underinsured motorist (UIM) coverage applies when the at-fault driver has liability insurance, but their policy limits are not high enough to cover your total damages. For example, if the at-fault driver carries only $15,000 in liability coverage but your medical bills, lost wages, and other damages total $150,000, their insurance falls far short. UIM coverage fills that gap, paying the difference between the at-fault driver’s policy limits and your actual damages, up to your own UIM policy limits.
Pennsylvania requires minimum liability coverage of $15,000 per person and $30,000 per accident. These minimums are extremely low and can be exhausted quickly in any accident involving serious injuries. UIM coverage is what protects you when the other driver’s minimal coverage is not enough.
Is UM/UIM Coverage Required in Pennsylvania?
Pennsylvania law requires insurance companies to offer UM and UIM coverage to all policyholders. However, it is not mandatory for drivers to purchase it. When you buy or renew your auto insurance policy, your insurer must present you with the option to add UM and UIM coverage. You have the right to reject it in writing, but doing so leaves you and your passengers vulnerable.
Many drivers decline UM/UIM coverage to save money on their premiums, not realizing how affordable it typically is or how much they stand to lose without it. The cost of adding UM/UIM coverage is usually a fraction of the total premium, but the protection it provides can be worth hundreds of thousands of dollars. If you have been in an accident and are unsure about your coverage, our car accident attorneys can help you review your policy and identify all available sources of compensation.
Stacking vs. Non-Stacking Coverage
What Is Stacking?
Pennsylvania allows policyholders to choose between “stacked” and “non-stacked” UM/UIM coverage. Stacking means that you can multiply your coverage limits by the number of vehicles on your policy. If you have $100,000 in stacked UIM coverage and three vehicles on your policy, your effective coverage limit is $300,000.
Stacked vs. Non-Stacked: Which Should You Choose?
Stacked coverage costs more than non-stacked, but the additional protection can be substantial, especially for families with multiple vehicles. Non-stacked coverage limits you to the per-vehicle amount regardless of how many cars are on your policy. For most families, the relatively modest increase in premium for stacked coverage is well worth the significantly higher protection it provides.
How UM/UIM Claims Work
Filing a UM Claim
When you are injured by an uninsured driver, you file a claim with your own insurance company under your UM coverage. Your insurer will investigate the accident and your injuries, much like a liability claim. It is important to understand that even though you are filing a claim with your own insurer, the process can still be adversarial. Your insurance company has a financial incentive to minimize your payout.
Filing a UIM Claim
UIM claims are slightly more complex. In most cases, you must first exhaust the at-fault driver’s liability coverage before your UIM coverage kicks in. Once you have settled with or obtained a judgment against the at-fault driver, you can then file a UIM claim with your own insurer for the difference. Be aware that posting about your recovery on social media can hurt your UM/UIM claim just as it can with any other personal injury case.
Common Disputes in UM/UIM Claims
Insurance companies frequently dispute UM/UIM claims on several grounds. They may argue about who was at fault for the accident, challenge the severity of your injuries, question whether your treatment was reasonable and necessary, or offer a settlement far below the value of your claim. Because you are dealing with your own insurance company, many people assume the process will be straightforward. Unfortunately, that is not always the case.
If you and your insurer cannot agree on the value of your claim, the dispute may go to arbitration or litigation. Having an experienced attorney on your side levels the playing field and helps ensure you receive fair compensation.
How Much UM/UIM Coverage Should You Carry?
The right amount of coverage depends on your personal circumstances, including your assets, income, health insurance coverage, and risk tolerance. At a minimum, your UM/UIM limits should match your liability limits. Many financial and legal advisors recommend carrying at least $100,000 per person and $300,000 per accident in UM/UIM coverage, or higher if your budget allows.
Consider that a serious car accident can easily result in six-figure medical bills, months or years of lost income, and significant pain and suffering. The state minimum of $15,000 is woefully inadequate for anything beyond a minor fender bender with no injuries.
Protect Yourself Before an Accident Happens
The time to think about UM/UIM coverage is before you need it. Review your auto insurance policy today and make sure you have adequate protection for yourself and your passengers. If you have already been in an accident involving an uninsured or underinsured driver, contact Gieg and Jancula for a free consultation. We can review your policy, identify all available coverage, and fight to get you the compensation you deserve.