Understanding Uninsured and Underinsured Motorist Insurance In Texas
Why is Uninsured Motorist (UM) and Underinsured Motorist (UIM) insurance so important? Because they afford the only protection you have against a possible catastrophic loss. These coverages protect you if you are hit by someone who has no insurance, or not enough insurance. Let's say you're driving down the road, you're fully insured with liability coverage that complies with Texas law, and somebody collides with your car, severely damaging the car and injuring you and whoever else is in the car with you. If the guy that hit you doesn't have any insurance, you are in a very bad situation. Your liability insurance will not pay to have your car repaired, will not pay for a rental car, and will not pay your medical bills, lost wages, or pain and suffering damages. Sure you can sue the fellow that hit you, but if he couldn't afford minimum insurance, it's highly doubtful he can pay a judgment. So now you're stuck with a worthless car and mounting medical bills.
Is this a common problem in Texas where everyone is required to have minimum liability insurance? You betcha. Some estimates run as high as 40% of the drivers on Texas roads do not have any insurance. An amazing number considering the legal requirements and penalties. And an even greater number carry only minimum limits of 30/60/25. That means $30,000 per person and $60,000 per accident for bodily injuries, and $25,000 per accident for property damages. With the price of cars and car repairs, not to mention the high cost of medical treatment, it doesn't take a severe accident to cause damages that exceed these limits. That's where underinsured motorist insurance kicks in to cover the difference.
Due to the high number of uninsured and underinsured motorists, driving without these coverages is like Russian Roulette. Sooner or later it will catch up to you. My advice is to carry UM and UIM coverages with limits equal to your liability coverage limits.