Underinsured Motorist (UIM)

Underinsured motorist coverage (UIM) steps in when a driver who caused your accident has liability insurance, but not enough of it to cover the full extent of your injuries or damages. It is a common misconception that being hit by an insured driver means you are fully protected. Georgia's minimum required liability coverage is only $25,000 per person. If your medical bills, lost wages, and pain and suffering total $90,000, a driver carrying the state minimum leaves you $65,000 short -- and UIM coverage is what bridges that gap.

Here is how UIM works in practice. You are T-boned at an intersection by a driver who carries $25,000 in bodily injury liability coverage. Your injuries require surgery, physical therapy, and three months out of work. Total damages: $80,000. The at-fault driver's policy pays its $25,000 limit. Your UIM coverage -- if you carry $100,000 in UIM limits -- pays the remaining $55,000 up to your policy limit. You recover the full $80,000 between both policies. Without UIM, you would need to pursue the at-fault driver personally, and most underinsured drivers have limited personal assets to collect.

UIM is most valuable in states with low minimum liability requirements, where a large percentage of insured drivers carry the bare minimum. Georgia sits in that category. Studies consistently show that 20 to 30 percent of Georgia drivers either carry only the state minimum or are uninsured entirely. In that environment, UIM is not an optional add-on -- it is the mechanism that protects you from the financial consequences of other people's choices.

Stacking is an enhancement available in some states that allows you to multiply your UIM limits across multiple vehicles on the same policy. If you carry $100,000 UIM and have three vehicles, a stacked policy provides up to $300,000 in UIM coverage per occurrence. Georgia allows stacking in some circumstances; ask your agent whether it applies to your situation and what it costs to add. The premium difference is typically modest relative to the coverage increase it provides.