What is UM coverage and why do I need it?

Many times in passing conversation, people ask about this coverage, and why it is necessary. In the event a person doesn’t have it and I ask why, they generally give a variant of “If the other party is at fault, that person’s insurance should pay for all damages.”

This argument, while understandable, is misguided for a couple of reasons. Namely, it presumes that all motorists on the road will carry appropriate coverage limits, and that if liability is clear, then the insurance company will automatically accept responsibility and tender a fair settlement in a rapid manner. Both of these are dangerous presumptions.

First, a large number of motorists in California sadly do not carry any insurance whatsoever. Thus, even if all fault might be attributed to them, pursuing a legal action against them may well be pointless, as they will have no assets from which to collect. As such, UM or Uninsured Motorist coverage, will provide you with a source to pursue damages for your injuries in the event you are injured by someone without insurance.

Second, under California Law, a motorist is only required to carry $15,000/$30,000 coverage. This means that if only one person is injured, the insurance carrier for a minimal policy at most is obligated to pay $15,000.00 under the insurance contract. If two or more people are injured, then under the contract the insurer is obligated to pay only $30,000.00. Thus in the event that there are severe injuries than these amounts will be less than sufficient. Carrying high limits for UM/UIM coverage will provide an additional source of recovery in the event a third party has minimal coverage.