What is uninsured or underinsured coverage?
Most people may carry vehicle insurance, but many don't understand what Uninsured Motorist (UM) or Underinsured Motorist (UIM) bodily injury coverage is. In short, it's coverage that can protect you when another driver injures you but either has NO insurance or NOT ENOUGH insurance to cover your medical bills and other losses. If you see "UM" bodily injury insurance on your policy then you also have "UIM" coverage (even if "UIM" isn't spelled out), and vice versa, because they are interchangeable. If you don't see it, it means that you rejected it when you purchased the policy. If that's the case, for your own sake, read on and then decide if the small amount of money you might be saving every month is really worth the huge amount of protection you are giving up.
Required insurance coverage in Colorado
Colorado law requires that you carry at least $25,000 in bodily injury "liability" coverage to pay for the injuries of other drivers, but does not require that you carry UM / UIM bodily injury coverage if you reject it in writing. Your bodily injury liability coverage pays for the medical bills, pain, suffering, and lost wages of OTHER drivers, while UM / UIM coverage pays for YOUR own bills, pain, suffering, and lost wages that are caused by an uninsured or underinsured driver. So since the law requires that you protect OTHER drivers with liability coverage, it makes very little sense not to protect YOURSELF with UM / UIM coverage.
Recommended coverage for Colorado drivers
There are over half a million drivers in Colorado with NO INSURANCE. If you get hit by one of them and they don't have insurance, chances are pretty good that they don't have other assets to pay for your medical bills and lost wages either. And while health insurance might cover some of your medical bills, it still doesn't cover a lot that UM/UIM coverage does, such as: out-of-pocket costs like prescription receipts and health insurance deductibles, physical pain, emotional suffering, lost wages, and permanent impairment. That is why we strongly recommend that all our clients carry at least $50,000 of UM / UIM coverage on your car policy at all times, even if you have good health insurance. You may be surprised at how little it changes your monthly premiums, usually just an extra $5-$10 per month, depending on how much UM / UIM coverage you want.
Your rates will not increase if the accident was not your fault
Some people worry that if they try to make a claim for their UM / UIM coverage, their insurance rates will go up. This is not the case. If the accident was not your fault, which is the only time UM / UIM insurance applies anyway, your insurance company cannot raise your rates for simply using the insurance that you pay for.
Insurance companies must be fair about claims
Your own auto insurance must treat you reasonably and in good faith when you make a claim for your UM / UIM insurance benefits. If they act in bad faith, deny your rightful insurance benefits, or delay in paying your rightful insurance benefits, they may have to pay you a lot more than just your policy benefits according to new Colorado laws.
Let an attorney protect your right to fair recovery
If you have questions about UM / UIM insurance, or you believe your insurance company is not treating you fairly after making a claim for your UM / UIM benefits, you may need to speak with an attorney. Gama Law Firm in Aurora offers free consultations, and like most personal injury law firms, if you hire us we never get paid until you get paid.
To learn more about other types of coverage on most Colorado car insurance policies, you may also find this article helpful: Are you underinsured?