The Dangers of Being Underinsured

Perhaps you have heard the term underinsured with regards to insurance coverage. In plain terms, being underinsured implies that a person has inadequate insurance coverage. Here is an in-depth look at what it means to be underinsured so that you can avoid future liabilities that accompany alack of adequate coverage.

Explaining Underinsurance

Being underinsured means that your policy limits are not high enough to meet the expenses if you were to file a claim. The underinsurance issue often arises during automobile accidents. Unfortunately, many automobile accidents lead to large disputes and claims. As a driver, you must be aware of your state’s auto liability coverage and the minimum limit that drivers have to purchase. Perhaps you are looking for a way to save money on your auto insurance premium, so you opt for a policy with basic coverage limits.

How Being Underinsured Impacts Your Auto Insurance

If an accident were to occur, the basic coverage limits on your policy might not be enough to cover all of the damages. In this scenario, you will be left having to pay for some of the expenses out of your own pocket. You may not be covered if the other driver suffers serious injuries. You may exceed your coverage limits if multiple people are injured in the accident. You may also be impacted if the other driver’s vehicle is destroyed in the accident or the aftermath causes them to become disabled. As you figure out the type of auto insurance coverage that you want, you must pay careful attention to the liability limits.

Uninsured or Underinsured Coverage

Uninsured and underinsured insurance coverage generally serves the same purpose. These policies serve to prevent you from having to pay a lot of money to cover damages to your vehicle that you are not responsible for. Uninsured coverage protects you if you are involved in an accident with someone who does not have coverage. Underinsured coverage protects you if you are involved in an accident with someone whose liability limits are too low to cover all of the damage that they caused.

Underinsured Health Coverage

In the last couple of years, there has been an increased focus on health insurance coverage. The ongoing pandemic has caused thousands of people to lose their jobs and possibly their health coverage. At its core, underinsured healthcare means that you do not have enough coverage to protect you if you get ill. You are then forced to cover the rest of your medical care expenses out of pocket. This issue often occurs if you need emergency care. Accidents can happen at any time, and many people are left unprepared if they suffer a medical emergency.

There are multiple reasons why you may have underinsured healthcare. There could be limited availability of public coverage in the state that you reside in. It’s also possible that you opted for coverage through your employer. Depending on your health, your employer’s health insurance policy may not be enough to fully cover you. Even if you have health insurance through your employer, consider adding your own personal health insurance policy. This will give you a wider variety of options regarding your treatment. You need enough coverage so that you do not find yourself in a position of being unable to pay your medical bills.

You should avoid being underinsured at all costs. Increasing your liability limits reduces the potential of you having to pay a lot of money in the future out of your own pocket. Contact our team at Sausman Insurance Agency in Mifflintown and Millersburg, Pennsylvania for help finding the right insurance plan for you and your family. We’re more than happy to provide you with a customized auto insurance policy.