According to the Insurance Research Council, a growing number of people under financial pressures are electing to drop their car insurance. The council estimates that with current unemployment rates hitting many people very hard, by 2010 one out of every six cars on the road will be uninsured. The next time you’re in a grouping of cars on the interstate, take a moment and look around. Statistically speaking, at least one of those cars is uninsured.
What if that car hits YOU?
Several years ago a friend of mine was driving down a 4 lane road when a car crossed the median and hit him behind the driver’s side door. Though his car spun around and his door jammed, he was completely unharmed and climbed out through the passenger side door. The other driver was severely injured and he rushed over to check on her, calling for police and an ambulance on his cell phone. As it turned out, she had ZERO insurance, no job, and no real assets. Thankfully, he had uninsured motorist coverage and his car was replaced (it was totaled). Not only that, his own insurance company compensated him for time lost from work as well as for a rental car until he purchased a new vehicle.
With the exception of New Hampshire and Wisconsin, every state now requires that motorists carry liability insurance on their vehicles, but just because it’s required doesn’t mean everyone carries it. When I lived in South Carolina, your car insurance was somehow pegged to your driver’s license through their computer database. Let it lapse and your license was suspended!
A few states (21 plus DC) now require motorists to purchase coverage to pay for their own medical expenses, pain and suffering losses, and car damage in case of an accident where the other motorist is at fault and is either uninsured or underinsured. Does your state?
| Alabama | No |
| Alaska | No |
| Arizona | No |
| Arkansas | No |
| California | No |
| Colorado | No |
| Connecticut | Yes |
| Delaware | No |
| DC | Yes |
| Florida | No |
| Georgia | No |
| Hawaii | No |
| Idaho | No |
| Illinois | Yes |
| Indiana | No |
| Iowa | No |
| Kansas | Yes |
| Kentucky | No |
| Louisiana | No |
| Maine | Yes |
| Maryland | Yes |
| Massachusetts | Yes |
| Michigan | No |
| Minnesota | Yes |
| Mississippi | No |
| Missouri | Yes |
| Montana | No |
| Nebraska | No |
| Nevada | No |
| New Hampshire | Yes |
| New Jersey | Yes |
| New Mexico | No |
| New York | Yes |
| North Carolina | Yes |
| North Dakota | Yes |
| Ohio | No |
| Oklahoma | No |
| Oregon | Yes |
| Pennsylvania | No |
| Rhode Island | Yes |
| South Carolina | Yes |
| South Dakota | Yes |
| Tennessee | No |
| Texas | No |
| Utah | No |
| Vermont | Yes |
| Virginia | Yes |
| Washington | No |
| West Virginia | Yes |
| Wisconsin | Yes |
| Wyoming | No |
Even if your state doesn’t require the purchase of uninsured or underinsured motorist coverage, it might be a wise purchase because, even if you have medical coverage through your job or have purchased it on your own, an uninsured motorist rider can pay for your pain and suffering as well as other damages. Also, if you’re severely injured and your medical claims escalate to high levels, an uninsured/underinsured motorist rider can slow your progression to the lifetime maximum that many health policies now incorporate.
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By default, I always carry the max insurance including uninsured motorist. I’m shocked that California doesn’t require it!
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Admin 's reply:
June 26th, 2009
It blew me away too!
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This is great advice…. there will always be knuckleheads that don’t care enough about their own future to buy insurance much less your future…
Buy it, hope you never need it, but be thankful its there if you every do…
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Admin 's reply:
June 26th, 2009
It does come in handy when you need it, that’s for sure.
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We have it to the maximum with our insurance. Thanks for the article.
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I can’t blame those people who drop their car insurance. Times are really tough nowadays and people will do everything just to save money. In my opinion, if they really do want to save, why not rent or sell the car?
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