Differences between Uninsured and Under-Insured Drivers

Interviewer: What is the difference between an uninsured and under-insured driver?

Daniel Hoarfrost: They’re actually a variation on the same theme, but the basic policy is on their uninsured or under-insured coverage. If you’re involved in an accident and the other driver either doesn’t have insurance or doesn’t have enough insurance, or their policy limit is less than what you carry, then your own insurance provides coverage.

In Either Scenario, Your Insurance Typically Supplies Coverage to Make up for the Lack of Insurance Carried by the Other Driver

Of course, only if the damage is justified. The uninsured motorist situation is a little easier to understand because it’s simply a matter of the other driver not having insurance. Drivers are required to have insurance. And in that situation, your own insurance, if the other driver’s at fault and if there’s injury, supplies coverage just like they were the insurance company for the other driver.

In Oregon, the Minimum Liability Coverage Drivers Carry is $25,000

The under-insurance claim is basically the same, but what it boils down to is the injuries suffered support a larger claim than the amount of insurance that the other driver has. So frequently, here in Oregon, for example, the minimum required coverage is $25,000 in liability.

It’s usually a good idea to carry more than that, but many people don’t. If there’s an injury where someone’s gone to a hospital and run up significant expenses, more than $25,000, then your own policy kicks in to make up the difference up to the amount of your coverage.

It Is Advisable to Carry More than $25,000 Liability for Your Own Protection

It’s usually a good idea for people to carry higher uninsured and under-insured motorist coverage for their own protection, just in case.

With an Uninsured Motorists Claim, If Your Own Insurance Policy Will Not Resolve the Issue, You Have to Take Action against Them within the Statute of Limitations

Interviewer: How do you begin that process with an uninsured motorist claim?

Daniel Hoarfrost: You begin the process pretty much the same way you begin any claim.  The only significant difference is that if you can’t resolve it with your own insurance company, then you have to take action against your insurance company within the statute of limitations.

Sometimes there are automatic arbitration clauses that come in to play, so the claim may go to arbitration as opposed to a lawsuit in a regular court.

But essentially, at the outset of the claim, you notify your company just like you normally would.  You have your PIP coverage that you begin to get underway early on so that your medical bills will be covered.  And then if it becomes apparent that the other driver doesn’t have any coverage, then your company sets up a claim file under the uninsured motorist coverage.

A Hit and Run Accident Is Similar to an Uninsured Motorist Claim, This Is Why It Is Essential to Have a Police Report    

The only sort of complicating factor in the early stage is if it’s a hit and run situation, which is basically a variation on the uninsured motorist theme. Since you can’t identify them, they’re basically an uninsured motorist.

As part of the coverage, all the policies require that you make a police report so the police agencies have a chance to investigate and locate the other driver.

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