If you’re involved in a car accident and the at-fault driver does not have insurance coverage, you may have to file an insurance claim against your own policy to cover your losses.
If you have uninsured motorist (UM or UMBI) coverage, it will pay for your medical bills, lost wages, funeral expenses, and compensation for your pain and mental suffering.
A Closer Look at Uninsured Motorist Coverage
According to the Insurance Research Council, roughly one in 8 drivers didn’t have insurance in 2019. This underscores the importance of uninsured motorist car insurance coverage – it’ll cover your medical expenses and other costs if you or the passengers in your vehicle get injured in an accident caused by an individual that does not have insurance.
The uninsured motorist coverage usually can’t go higher than your standard liability coverage. So, if your total liability coverage per accident is $100,000 then that means your uninsured motorist coverage is also no more than $100,000.
Uninsured vs. Underinsured Motorist Coverage
Similar to UM / UIM / UMBI coverage, underinsured motorist coverage steps in when you’re in an accident with a driver who has insurance but doesn’t have enough coverage to fully compensate you for your injuries. This coverage is not a requirement in most states but it’s available as an add-on option.
Majority of insurance providers set a limit to the amount of time you have to file uninsured motorist / underinsured motorist claims. Typically, it’s between 30 to 60 days from the date of the accident.
Uninsured Drivers in No-Fault Car Insurance States
If you live in a no-fault car insurance state, your own insurance coverage will pay for your medical bills and other covered losses so it won’t matter if the at-fault driver is not insured. Currently, there are 18 states that require no-fault insurance:
- Arkansas
- Delaware
- Florida
- Hawaii
- Kansas
- Kentucky*
- Maryland
- Massachusetts
- Michigan
- Minnesota
- New Jersey*
- New York
- North Dakota
- Oregon
- Pennsylvania*
- Texas
- Utah
- Washington
*These 3 states are often referred to as “optional no-fault” or “choice no-fault” states. In these states, drivers have the option to decide whether they want to operate under a no-fault system.
In no-fault states, you can’t sue the at-fault driver unless you suffered severe injuries. And if they don’t have insurance, then it’s pretty much pointless to sue them.
Using Personal Injury Protection Insurance
For states that do not abide by mandatory no-fault rules, you can avail of personal injury protection (PIP) insurance or Medical Payments (MedPay) coverage, which can be used to pay for your medical bills if the other party is uninsured.
You typically don’t need to wait until your treatment is complete before you can file a claim with PIP or MedPay. Just submit your medical bills as they come and make sure to follow the correct procedures outlined by your insurance provider.
Personal Injury Protection (PIP) vs. MedPay vs. Bodily Injury Liability Insurance
Personal Injury Protection (PIP) is mandatory in states with no-fault insurance laws and optional in others. It covers medical expenses as well as includes provisions for psychiatric care, rehabilitative care, lost wages, and other costs related to the accident.
MedPay is optional in most states and covers medical expenses for injuries sustained in a car accidents. However, it doesn’t cover lost wages or other expenses.
Choosing between PIP and MedPay depends on your specific needs and the requirements in your state. While the former offers more comprehensive coverage, having both means that if you exhaust your PIP limit, MedPay can help cover your additional medical expenses.
Bodily Injury Liability Insurance, on the other hand, covers injuries sustained by individuals in another vehicle if you’re at fault in an accident. Covergae includes medical bills, long-term physical pain, lost wages, legal fees, and funeral costs.
Unlike PIP and MedPay, which cover expenses for those in your own vehicle, Bodily Injury Liability Insurance compensates individuals in other vehicles involved in the accident.
Using Collision Coverage After an Accident If the At-Fault Driver is Uninsured
Although not required in any state, rear and collision coverage is an optional add-on coverage to your car insurance policy. This coverage will take care of the repair expenses (up to the limits of your policy) for your vehicle if:
- You were responsible for the accident.
- The at-fault driver is uninsured.
- You were involved in a hit-and-run incident.
- However, it’s important to note that collision coverage only applies to vehicle damage and does not extend to cover injuries sustained in the accident.
Can You Sue the Uninsured Driver?
If the at-fault driver is uninsured, you have the option to sue them. However, even if you win in court, the outcome may not be as rewarding as you hope. You may get a judgment against the uninsured driver but it doesn’t always mean you’ll receive the awarded amount.
Do Insurance Companies Go After Uninsured Drivers?
While insurance companies have the legal authority to pursue reimbursement from those responsible for covered losses, they are unlikely to do so for the same reasons we’ve discussed earlier. Unless the uninsured driver possesses adequate assets to satisfy a court judgment, it’s not financially viable. They would just call this uninsured individual “judgment-proof.“
But What If the Uninsured Driver is Driving an Insured Vehicle?
If the at-fault driver has no car insurance, but the vehicle they are driving is insured, then the policy will extend to your accident. That is, unless the driver did not get permission to use the car, or has been excluded (specifically) from coverage under the policy of the vehicle owner.
Penalties for Driving without Car Insurance
In most states, driving without car insurance coverage can get you in trouble. You must have the minimum coverage requirements for your state otherwise you could face hefty fines, jail time or even get your license revoked. These penalties apply even if you do not get into an accident.