One of the most common questions I hear is: Do I really need uninsured motorist coverage, isn’t that why I have health insurance?
For me, the answer is simple. Yes, you do need it. Hopefully you’ll never have to use it, but I wouldn’t take that risk. Sure, your health insurance may cover some of the costs if you’re injured in an accident, but you’ll still have out-of-pocket expenses.
Consider this situation:
You’re driving home from work and another driver runs a red light and smashes into your car. You’re taken to the hospital by ambulance where you undergo surgery for your lacerated liver and some internal bleeding. Luckily, you’re alive and will make a full recovery.
Unfortunately, you will be in the hospital for a week and out of work for another 3 weeks after that while you recover from your injuries.
You finally get the police report, only to find out the other driver was driving without insurance. You can take them to court for damages they caused, but that will take months, if not years.
You have collision coverage on your car, so you call your insurance company for help. They cover the cost to repair your vehicle, but you rejected uninsured motorist and medical payments coverage, so your medical bills will not be covered.
At this point it has been about a month. You haven’t received a paycheck in that long and you’re struggling to make your car and house payments, let alone your cell phone, electricity and other expenses.
Now you get a bill in the mail for the ambulance ride. It turns out the responding ambulance service is run by a private company (yes, this is a real thing), and considered out-of-network for your insurance, so you’re stuck with the $2,400 bill that is due in 20 days.
Just when you think the worst of it is over and you are finally back to work (although waiting another 2 weeks for a paycheck), you start to get the hospital bills from every single doctor that saw you.
You’re young and healthy, so you chose a catastrophic health plan to lower the monthly cost of your health insurance. You only go to the doctor for your annual physical and you are never sick, so it made sense at the time. Unfortunately, that means your deductible is $7,500, and your care after that is covered at 70%.
From the time of the accident until you finally get a paycheck over 6 weeks later, you have received over $15,000 in bills, on top of your normal payments that you are late paying. You’re in constant pain and need to see a chiropractor, but you just can’t afford it.
Now let me ask you, was it worth it to save a few hundred dollars by rejecting uninsured motorist coverage?
My guess is: No.
Sure, maybe this seems unlikely and hopefully it never happens to you. But this is a real-life situation that happened just a couple of months ago, not a hypothetical scenario.
I, personally, would rather hope for the best but also prepare for the worst. On my auto policy, I have $500,000 worth of uninsured motorist coverage.
So, rewind for a minute. If the same exact accident happens to me, after I find out that the other driver was uninsured and I call my insurance company, my insurance is paying for everything.
The hospital bills that I get in the mail? I’ll send those to the adjuster to pay.
The time I have missed from work? I’ll be reimbursed for those lost wages and will not struggle to pay my bills.
The chiropractic care I need so I can sit, walk, sleep and live my life? My policy will pay for it.
I will still have to go through the physical recovery, but I will have the support I need to move on financially. This accident will not destroy my life.