Cancelling Your Uninsured Motorist Policy Can Save Money - But Should It?

Uninsured motorist coverage also protects you in cases of hit and run incidents, providing coverage from mishaps caused by individuals driving without proper insurance policies in place. Image by Robert Michael/dpa via Getty Images [+] Author considers whether to drop this portion of his auto policy.
My wife and I found ourselves caught up in Hurricane Milton in Western North Carolina at just the right time, which left an unprecedented destruction in its path. While our car got caught in a ditch and needed towing out for repairs – taking three days until an available tow truck could arrive to help tow us. Once through all the mud and downed trees, broken roads, power outages, long gas lines etc we managed to drive home two weeks early than originally scheduled!

At first we only needed reimbursement for towing services; after repeatedly assuring them of both our safety and that of the vehicle. But on further consideration one agent advised, “Your premium for next year is due so this might be a good time for us to review your coverage”.

“Certainly,” I responded happily when we finally had decent phone service. After an unexpectedly brief pause, the agent surprised me by inquiring about our health insurance plan and I informed her we are both on Medicare as well as fully covered under secondary plan supplemental. After making her offer of saving almost 40% off our semi-annual bill by eliminating “Uninsured Motorist” coverage; thus lowering risk significantly and offering us lower premiums significantly than before.

What, exactly is Uninsured Motorist coverage and do I require it?
Intuitively I could understand what UMC covered; so, out of curiosity I inquired with an agent. She confirmed my understanding by explaining it would protect in case of an accident with someone without enough or any insurance at all (such as hit-and-run drivers) as well as cover other expenses like lost wages and “pain and suffering”.

Well, that was pretty clear to me at first. After further consideration though, I realized that any medical expenses related to an accident will be covered by my health insurance and any lost wages wouldn’t impact me either; additionally, any damages to my car would also be paid for; so everything should work out fine in terms of coverage!

As far as I could determine, what my insurance wouldn’t cover was “Pain and Suffering”. So my question became whether or not paying almost 40% more in Florida with such high insurance premium rates than cancelling would save. Doing this would save almost $1500 annually!

Every insurance professional I’ve spoken with emphasizes the fact that insurance should give us peace of mind, and uninsured motorist coverage protects financially against drivers without insurance policies – this can be particularly vital in areas with a high percentage of uninsured motorists.

Florida stands out as being a state with a higher than usual incidence of uninsured and underinsured drivers, yet I found myself questioning why: I drive so rarely now that my exposure may not be comparable with most drivers’; yet $1500 seems excessive when one considers my health insurance, wages, and driving behaviors are covered.
But for more comprehensive coverage on this topic, I contacted experts from American Property Casualty Insurance Association. Here I learned something I hadn’t considered – which wasn’t even mentioned by my agent: UMC covers not only medical bills and lost wages for you and passengers as well.
That changed everything! My peace of mind takes on new significance when I consider all of the times I transport loved ones!