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What is underinsured insurance?

April 26, 2017Insurance underinsured

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What is underinsured insurance?

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Sometimes drivers on the road have insurance, but not enough to pay the value of a persons claim. If the driver injures another person, the insurance will be inadequate to cover the damages. Injured parties, however, may be covered by their own insurance policies; uninsured and underinsured motorist coverage protects accident victims in these cases. For example, the driver who caused the motor vehicle accident also caused serious and permanent injuries to the other driver. The injured driver also sustained a past and future wage loss as the result of their injuries. The driver who caused the crash may only have $15,000.00 in insurance coverage. The injured driver’s case is likely valued in excess of $15,000.00. In such a case the injured party is then permitted to make an underinsured claim with his own insurance carrier for additional coverage.