Uninsured and Underinsured Motorist Coverage (UM/UIM) – What is it and is it contagious?

North Carolina law requires motorists to carry a minimum of $30,000.00 per person and $60,000.00 per accident in bodily injury liability coverage to protect other drivers from their negligence.  While motorists can buy liability insurance with much higher limits (and I recommend they do), many still purchase minimum limits policies.  If you have been to the doctor lately, you understand that $30,000.00 is not a lot of money, medically speaking, and if you are the victim of another driver’s negligence you could very quickly find yourself with medical bills exceeding $30,000.00.

Fortunately, the law provides a way for motorists to protect themselves and their families from financial hardships that might accompany a bumper-to-bumper encounter with a negligent driver.

North Carolina General Statute 20-279.21 requires insurance companies to provide their insureds an opportunity to purchase uninsured motorist coverage (UM) or combined uninsured/underinsured motorist coverage (UM/UIM) when they purchase liability policies with limits in excess of the $30,000/$60,000 minimum.  Moreover, the law requires insurance companies to offer insureds an opportunity to purchase up to $1,000,000.00 in UM coverage, or the same amount of combined UM/UIM coverage.

Now let’s talk about what these terms mean.  UM coverage provides Insurance for bodily injury and property damage in the event that one is injured by the negligence of a driver who has no insurance.  Similarly, a UIM policy provides insurance coverage in the event that one is injured by the negligence of a driver who does not have enough liability insurance to compensate another driver for the injuries caused by his negligence.  Legally speaking, a vehicle may be underinsured when the limits of a negligent driver’s liability policy are less than the limits of an injured driver’s UIM policy.  

Moreover, the great thing about UM/UIM coverage is that it typically is much more affordable than liability coverage.  So, don’t leave it to others to protect your financial interests. Talk to your agent about Uninsured and Combined Uninsured/Underinsured Motorist Coverage!    

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