Any frequent reader of this blog knows that I tell people all the time that you need underinsured motorist coverage in Colorado. Everyone needs it. Period. In fact, let me go through the list of questions that I frequently hear and give you the simple answer to each one:
Do I need uninsured motorist coverage if I have health insurance?
Yes.
Do I need uninsured motorist coverage if I have full coverage?
Yes.
Do I need uninsured motorist coverage if I have collision and comprehensive coverage?
Yes.
Does collision insurance cover uninsured motorist?
No.
Let me break it down a bit more for you…
Colorado only requires that drivers have $25,000 in liability coverage. That’s not much at all. So, when you’re out on the roads, you should assume that everyone you see has only $25,000 to give you if they cause an accident in which you’re the victim.
Of course, many people probably have more coverage than that, but a LOT of people on the road only have $25,000 in liability coverage.
What does that mean?
If you’re the victim in a car accident caused by someone with only $25,000 in liability coverage, you will likely only get $25,000 for your property damage and medical needs. Now, if you were going on a vacation, $25,000 is a lot of money. When you’re fixing a car and your body, $25,000 is next to nothing.
So, you need to protect yourself by purchasing uninsured motorist coverage (UIM), which will help to cover your costs after an accident.
When I explain this to people, I’ve heard them yell, “That’s not fair! Why should I have to tap into my own insurance if someone else hit me?!”
To which I respond, “Get over it! That’s life! Colorado only requires that people carry $25,000 so you’d better do what you can to protect yourself in case you get hit by one of those people!”
Yes. You do! First of all, your health insurance won’t cover any property damage, like your car and anything you have in it (such as your computer, tablet, phone). Health insurance won’t help at all with your property damage, right? UIM will.
Second, do you have health insurance deductibles? Copays? Those can add up to thousands of dollars over the course of treatment. Your UIM will cover those. Also, if you need treatment outside of what your health insurance covers, such as chiropractic or other so-called “alternative” treatments, your UIM can help to cover those, as well.
There is no such thing as “full coverage.” You may have all the insurance that you’re required to have under the state of Colorado, but that doesn’t mean that you can walk away from any accident you cause or fall victim to without incurring costs. It just means you have the minimum required.
Hopefully, you have more than the minimum insurance required in the state of Colorado. However, I’m here to tell you that a lot of people do not. In fact, even though Colorado drivers are required to have $25,000 of liability coverage, there are people out there driving around with zero insurance. Nada. That is illegal, of course, but they do it.
So, if one of these people hits you, your “full coverage” won’t help you. You can’t tap into your liability coverage to pay for your bills. Also, you may have great collision coverage to help pay for your vehicle but that doesn’t pay a thing for your medical bills. UIM will help with all of it.
I know I’m starting to repeat myself, but yes.
This seems like a good time to explain the difference between liability coverage, collision coverage, and comprehensive coverage…
Liability car insurance covers damages to another person resulting from an accident that you cause. If you cause an accident, liability coverage will help you pay for damage to another person’s property or for costs associated with their injuries. (Your liability coverage doesn’t pay for any of YOUR expenses related to any accident ever. It pays for damage and injuries that you cause.)
I found a good comparison of the other two types of insurance at ValuePenguin:
Collision car insurance protects your car when it is involved in a crash with another vehicle or a stationary object. Most car crashes and auto accidents fall under this kind of insurance policy. The types of damages include crashing into another vehicle, another vehicle colliding with yours, or ramming into a streetlight, pole, or some other stationary object. It’ll cover the cost of repairs or replacements to your own car (liability coverage takes care of damages to other people’s property). [But remember: this coverage will not pay for any medical bills you incur.]
Comprehensive car insurance doesn’t give you complete coverage, contrary to what its name might indicate. Comprehensive car insurance just covers damages to your vehicle not caused by a collision, and car owners can be surprised by how much this can encompass. Comprehensive coverage generally falls under “acts of God or nature”, that are typically out of your control when driving – a spooked deer, a heavy hailstorm, a carjacking, etc.
I hope, after reading this article, you are convinced that you need underinsured motorist coverage in Colorado. Contact me if you have any questions about your coverage.
Phantom Car Accidents: What are the legal issues when someone causes an accident without hitting your car?
What to Do After a Car Accident: It can be hard to focus on what needs to be done at the scene of an accident. Use this info to help you navigate the situation.
