Uninsured motorist insurance is the most important type of liability insurance you can have on your
vehicle. Uninsured motorist/underinsured motorist coverage provides coverage to the operator of the
vehicle and the passengers in that car for damages caused by the driver of the other car when the other driver does not have insurance or when the driver does not have enough insurance coverage.
Uninsured motorist coverage is so important that Louisiana law requires the insurance company to offer it to you AND you can only reject it by completing a form and the form must be completed perfectly. Any mistake in the form is interpreted in favor of providing insurance coverage. It is the only category of insurance coverage, other than property damage coverage, that provides
coverage for the person purchasing the insurance. The liability insurance you pay for provides coverage for the other person if you are at fault in causing an accident. Uninsured motorist/underinsurance motorist coverage allows the owner of the policy to provide coverage for himself or herself.
The premiums for the various types of coverage is generally set by the Commissioner of Insurance. The premiums for uninsured motorist coverage will most often be the cheapest type of coverage that a person has. This is another way to encourage people to purchase uninsured motorist coverage.
Insurance agents are instructed not to encourage their clients to purchase it. They often tell their clients that they do not need uninsured motorist coverage if they have health insurance. This is not true. If it were true the law would not make it a requirement to offer it and make it so difficult to reject.
When I ask clients if they have uninsured motorist coverage, they do not know the answer, but they are quick to say that they have “full coverage.” You should ask questions and find out from your agent if you have uninsured motorist coverage. If you have it, you should find out how much you have. You should have as much uninsured motorist coverage as you can afford. It is usually cheaper than the other coverage and is the only coverage that covers you the insured.
Finally, there are two types of uninsured motorist coverage in Louisiana. There is uninsured motorist
coverage and uninsured motorist economic only coverage. The distinction is that economic only uninsured motorist coverage only covers the out-of-pocket expenses that you may have as a result of the accident. When you make a claim against that type of policy, your insurance company will often deny the claim if you received money from the insurance company on the vehicle that caused the accident. They will argue that you had no out-of-pocket expenses because the other insurance company paid you. Do not buy economic only uninsured motorist coverage.