Nobody likes to think about the prospect of experiencing an accident on the road or sustaining injuries due to somebody else’s negligent or reckless driving. However, life is famously unpredictable, so it’s always worth protecting yourself and your loved ones from the financial costs that arise following random accidents.

As you’re probably well aware, investing in relevant auto insurance is the most effective way to prevent significant damage to your finances in the event of an accident. What’s more, certain forms of auto insurance are mandatory in Wisconsin. All drivers in the state must purchase an automobile insurance policy, as stated on the Department of Transport’s website, and this policy must include liability insurance for bodily injury, property damage, and uninsured motorist coverage. Optional elements of your package may consist of coverage for collisions, medical expenses, and underinsured motorists.

If you’re confused about the differences between uninsured and underinsured motorist coverage, you’re not alone. As well as sounding deceptively similar, they serve comparable purposes and can help protect drivers and their loved ones from less responsible motorists. If you’re wondering whether you need uninsured motorist coverage, underinsured motorist coverage, or both, keep reading to learn the differences between these types of coverage and what you need.

What is Uninsured Motorist Coverage?

Uninsured motorist coverage protects people from drivers who have chosen to disregard state requirements to carry liability insurance. Uninsured motorist coverage of at least $25,000 for a single person and $50,000 for two or more people is mandatory in Wisconsin. In most collisions involving personal injuries or property damage, the driver at fault will use their insurance policy to cover the other motorist’s losses. But in a hit-and-run or when the person at fault doesn’t possess an insurance policy, uninsured motorist coverage will protect your finances if you or your passengers experience injury or other types of losses.

In the event you’re injured by an uninsured motorist, you can claim damages for lost wages, medical costs, and potentially compensation for non-economic damages like pain and suffering. If you have sufficient coverage, uninsured motorist insurance will also cover personal injuries to you as a cyclist or pedestrian.

It’s worth noting that uninsured motorist coverage doesn’t encompass property damage or protect other drivers involved in the accident. In fact, your insurer may decide to sue the other driver for negligence and to cover their own losses. If you’re keen to protect yourself against damage to your vehicle or other possessions, you should check out your policy’s collision coverage.

What is Underinsured Motorist Coverage?

Underinsured motorist coverage helps protect your finances if you or your passengers are injured in an accident involving an at-fault motorist whose bodily injury protection coverage can’t cover the cost of your injuries, medical expenses, and more. If you’re concerned about covering medical expenses and other finances resulting from bodily injury, this form of insurance could give you extra peace of mind.

If you’re in a crash with an underinsured driver, you can file an initial claim against their policy to claim the highest possible level of damages. Then, you can use your underinsured motorist policy to supplement the remaining costs.

How Do Uninsured Motorist Coverage and Underinsured Motorist Coverage Work Together?

While uninsured motorist and underinsured motorist coverage are designed for different situations, they work together by protecting you from all possibilities. Remember – you can never predict who will cause a crash. If you’re in the wrong place at the wrong time, comprehensive automobile insurance will help limit your financial losses and emotional distress.

Legal Requirements for Uninsured Motorist Coverage and Underinsured Motorist Coverage

According to Wisconsin’s Safety Responsibility Law, motorists must report accidents causing death, injury, or over $1,000 worth of property damage to the police. If an uninsured driver is at fault, their license and vehicle may be suspended, and they must take action to rectify the problem.

But what about the victim? In Wisconsin, drivers must carry uninsured motorist coverage for at least $25,000 for a single person and $50,000 for two or more people, meaning your insurer will cover claims involving an uninsured driver. As such, any auto insurance policy you take out should cover damage caused by uninsured drivers or hit-and-runs.

Underinsured motorist coverage is not mandatory in Wisconsin. However, if you decide to protect yourself from underinsured motorists, the coverage must amount to at least $100,000 per crash and $50,000 per person.

Remember to read through any auto insurance policy carefully before you commit, checking potential policies for any exclusions or special conditions that could disadvantage your claim in the event of a crash. Even if you adhere to the legal minimum requirements, you may not have sufficient coverage to adequately protect yourself and your loved ones in the event of a crash.

Key Differences Between Uninsured Motorist Coverage and Underinsured Motorist Coverage

So, now you know how uninsured motorists and underinsured motorist coverage work. What are their key differences? Here are the key takeaways to remember:

Uninsured Motorist Coverage (UM):

  • Will protect you if the at-fault driver has no insurance or in the event of a hit-and-run.
  • Covers medical expenses, lost wages, and other expenses related to injuries, but doesn’t include property damage.
  • Is mandatory in Wisconsin with minimum limits.

Underinsured Motorist Coverage (UIM):

  • Protects you if the at-fault driver’s insurance is insufficient to cover all expenses related to your or your passengers’ bodily injuries.
  • Bridges the gap between the at-fault driver’s policy limits and your actual damages.
  • Is not mandatory in Wisconsin. However, there are minimum limits in place for those who invest in underinsured motorist coverage.

The Bottom Line: Protect Yourself With Uninsured and Underinsured Motorist Insurance

While auto insurance policies can be confusing and dry, paying attention to the details of your coverage could save you a serious headache in the long run. Remember to assess the extent of your uninsured motorist and underinsured motorist coverage, opting for the most comprehensive coverage you can afford. While you can’t put a price on health and happiness, getting uninsured motorist and underinsured motorist coverage is a simple step you can take to protect yourself from the unfortunate events life throws at you.

What if UM and UIM Still Aren’t Enough?

According to a 2023 study, an estimated 15% of motorists in Wisconsin do not carry car insurance. This puts other drivers at greater risk in the event of a crash. Whenever a motorist doesn’t have the coverage to compensate you for the injuries and damages you suffer as a result of a crash, it makes recovering and moving on much harder for victims. Not only that, stingy insurance companies will go to great lengths to avoid paying compensation, even for their own customers.

In that case, it’s time to lawyer up. A personal injury attorney can help you navigate communications with insurers, even your own, to ensure that you receive the compensation you’re entitled to.

Attorneys Frank Pasternak and Jeff Zirgibel have over 50 years of combined experience representing car crash victims. Frank and Jeff know the tricks insurers will try to pull and how to fight for the compensation you deserve. Plus, they’ll personally handle your case, ensuring that your claim gets the attention it deserves during a difficult time, instead of passing it along to a junior attorney like bigger firms will do.

If you’ve been injured in a car crash, don’t leave it up to your insurance to do the right thing. Hold them accountable. To get started, schedule a free, no-obligations case evaluation with Frank or Jeff today.