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Your car insurance is really six separate policies—some are required, others optional—carefully weigh your risks when buying protection for you and your family.
Carole Walker, RMIIA

Uninsured Motorists Basics

Liability insurance is compulsory in 49 states and the District of Columbia. Only New Hampshire does not have a compulsory auto insurance liability law. Even so, in 2012, 12.6% of motorists, or about one in eight drivers, was uninsured, according to a 2014 study by the Insurance Research Council (IRC). The percentage has been declining in recent years. Oklahoma had the highest percentage of uninsured motorists, at 26%, and Massachusetts had the lowest, at 4%. The IRC measures the number of uninsured motorists based on insurance claims, using a ratio of insurance claims made by people who were injured by uninsured drivers relative to the claims made by people who were injured by insured drivers.

Some drivers cannot afford insurance or simply do not want to pay for it and are willing to risk getting caught. Penalties for driving uninsured differ from state to state, and can include fines, license suspension or revocation, losing your vehicle registration and license plates, vehicle impoundment, or jail time.

Uninsured / Underinsured Motorist Coverage

Uninsured motorist coverage (UM) pays for your medical expenses if you are injured in a crash caused by an uninsured motorist. This coverage usually includes underinsured motorist coverage (UIM), which protects you if you are hit by a driver who is underinsured. It will help pay for your medical bills and vehicle repair costs that may exceed the at-fault driver's own policy limits.

You also have the option to purchase uninsured motorist property damage coverage (UMPD), which pays for damage to your car. However, many drivers carry collision and comprehensive coverage instead, which pays for damage to your car in this situation, as well as other instances where your car could be damaged, such as a hailstorm or a collision with an animal.

Uninsured motorist coverage is optional in most states, although you may have to sign a waiver saying you choose not to purchase it. Twenty states and the District of Columbia have mandatory requirements for uninsured or underinsured motorist coverage. A handful of states, including Nevada and Texas, have passed laws and begun to develop and implement online auto insurance verification systems to identify uninsured motorists.

State Uninsured Motorist Laws:

State Auto Insurance Requirements:

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