Uninsured motorist coverage, or UM, provides coverage to you and others insured under your policy in the event someone else causes an accident that injures you or causes damage to your vehicle but the at-fault party has no insurance OR not enough insurance. These claims include hit-and-run incidents in which the at-fault party leaves the scene and cannot be located. Please note there are two types of UM coverage – reduced (sometimes call traditional) and add-on (sometimes called excess).
Reduced coverage, like it sounds, is reduced by the coverage carried by the at-fault party. For example, if you carry $100,000 in reduced UM coverage and are injured in an accident by someone who carries only $25,000 in liability coverage, your UM coverage is reduced to $75,000 for a net total of $100,000 in potentially recoverable coverage. Add-on coverage, on the other hand, provides coverage above and beyond the at-fault driver’s coverage. In the same scenario as above, your UM coverage would therefore not be reduced and you would instead be able to potentially recover up to $125,000 if your claim so warranted.
