What Is the Difference Between Uninsured and Underinsured Insurance Coverage?

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What is uninsured motorist coverage and underinsured motorist coverage? Well, these two types of coverages are very important, not just in a legal aspect but as part of your everyday life.

Both uninsured and underinsured motorist insurance is required by Indiana law that you have it with your liability auto coverage. Unless you sign a waiver, you probably have it on your policy.

These policies are there to protect you if you’re in a car accident and the person that hits you either has no insurance (which is uninsured motorist coverage) or does not have enough insurance (which is underinsured motorist coverage).

Uninsured motorist coverage would be if you’re hit by an uninsured motorist, so somebody who doesn’t have liability automobile coverage. They hit you, let’s say they rear-end you, and they’re uninsured. Then, your uninsured motorist coverage would kick in, and it would be like they were insured by your uninsured motorist coverage.

Underinsured motorist coverage, on the other hand, is if they don’t have enough coverage. Say that you’re rear-ended by the same person, but say the person only has $25,000 worth of coverage and you have $100,000 worth of damages. They would offer their limits for that $25,000 worth of their coverage, and then your underinsured motorist coverage would kick in and cover the rest of that $75,000 gap and make you whole.

It’s a very important coverage that everybody should have and usually does have.

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