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Pros and cons of opting out of uninsured motorist coverage

On Behalf of | Aug 29, 2018 | Insurance Coverage | 0 comments

The upside of rejecting uninsured motorist insurance in Texas is obvious to many people: it would likely reduce monthly auto insurance bills. The disadvantages of opting out are probably greater in most cases, although they could prove somewhat more difficult to enumerate and explain.

Many people see underinsured or uninsured driver coverage as supplemental to standard insurance policies: this is true, legally speaking. However, despite the fact that these insurance products are not mandatory, injured drivers routinely benefit from their coverage. 

Each state requires that drivers carry specific minimum levels of insurance coverage. For example, according to Chron’s small business section, Texas law requires drivers to carry $30,000 in injury coverage for their personal vehicles. While this might seem like a good deal of coverage, an MRI test alone could easily cost as much as 10 percent of the total figure. 

When another driver is at fault for an injury, the injured driver frequently depends on the insurer for the at-fault party to handle often-exorbitant medical bills. This is likely one of the main reasons that Texas statute requires policyholders to opt out of underinsured and uninsured motorist coverage — in writing. 

Obviously, uninsured and underinsured motorist coverage might help an individual who was facing large medical bills. While motorists have the option to reject this section of their policy when purchasing, doing so could lead to excessive financial burden in the case of an accident. One final benefit of these policies is that, even if the insurer decides to reject a claim, bringing suit against the company frequently results in a settlement or favorable decision for the complaintant.