An Accident with an Uninsured Driver
In 2011, the Insurance Research Council found that 1 in 7 drivers in this country does not have auto insurance. If you are involved in an accident with the “1,” the ramifications can be substantial.
A person who lives in a “no-fault” state will have their medical bills, lost wages (with state-to-state variations), and funeral expenses paid by their own insurance company, up to the coverage limits, regardless of who was at fault in an accident. A driver will need separate collision coverage to cover auto repairs.
In a “fault” (or “tort”) state, the at-fault driver is responsible for paying for damages and injuries to the other driver. If the at-fault driver has no insurance, you obviously aren’t going to be compensated by their nonexistent insurance company. In this scenario, you could file a personal injury claim against the at-fault driver to receive compensation for damages. However, if the at-fault driver wasn’t paying for auto insurance, it’s possible they won’t be able to pay for your damages.
Under these circumstances, your medical bills can be paid by your health insurance, and collision coverage can help you with auto repair costs. However, in both cases, you will be stuck with unmet deductible costs. As for lost wages and pain and suffering, you’re on your own.
Every driver should purchase uninsured/underinsured (UM/UIM) motorist insurance. It’s a great preventive measure to counter an otherwise dire situation. If the at-fault driver doesn’t have any, or enough, insurance to cover your damages, your UM/UIM policy will cover you up to the policy limits. It’s relatively inexpensive, so buy as much as you reasonably can.