Insurance and the Uninsured Driver – Is Umbrella Insurance Really Worth It?

Jim was looking forward to a relaxing day of golf with his neighbor, Bob. Jim pulled into Jim’s drive and popped the trunk. Bob threw in his clubs and then hopped into the front passenger seat.

“Great day for golf, Jim” Bob said as Jim drove out of his driveway in Brentwood and pulled onto Franklin Road.

“The trees are beginning to show color and the temperature is just right. Not too hot, not too cold, beautiful Nashville day” replied Jim as he pulled up to a stop sign. He signaled a left turn and began his turn on to the main highway leading to the golf course. That’s all he remembers before waking up in the hospital.

The unthinkable had happened. A speeding drunk driver had T-boned Jim’s car. The drunk driver’s car had hit directly on the front door of the passenger’s side. Jim’s injuries were not too bad. But Bob’s were massive and serious.

Now, 18 months later, Bob is struggling to walk. He has not returned to work. He suffered severe back and head injuries. He is tormented with blurred vision and has problems concentrating.

Bob sued the drunk driver. But the drunk driver had no insurance and no assets. As bad as Bob hated to do so, he file suit against his friend Jim. He had to recover his lost wages and the loss of future earnings caused by his disabling injuries. He had to support his family.

Jim understood, of course.  Bob’s suit was for $800,000. Considering his loss of earnings as an engineer, this amount was justified. Jim has auto insurance with $500,000 underinsured and uninsured motorist limits. Jim also purchased an umbrella policy for $1,000,000. He thinks his protection is adequate.

The trouble is Jim is going to be $300,000 short! You see, many insurance companies do not offer underinsured and uninsured motorist coverage under their umbrella policies. Does yours? Do you need excess uninsured motorist coverage on your umbrella policy as a driver on Tennessee roads?

On a daily basis, we get asked “Do I need umbrella insurance?” and “Is umbrella insurance worth it?” Well, the answer is yes to both questions, but there is more to the issue. An umbrella policy without protection from underinsured and uninsured motorists is not a complete solution to the risks on Tennessee highways.

What is the risk that you will be involved with an underinsured or uninsured driver?

• According to the Insurance Research Council, on a nationwide basis, 13% of drivers are uninsured. That’s about 1 in 7 drivers.
• What about uninsured drivers in Tennessee?  The Insurance Research Council reported that Tennessee is ranked 6th in the nation for having the highest rate of uninsured motorists. 20% or about 1 in 5 drivers are uninsured in Tennessee!
• Going to Florida for your vacation? Be careful! Florida, a densely populated state, is ranked 2nd in the nation for their uninsured motorists, with 24% of their drivers uninsured.

All this data does not take into account those drivers which are grossly under insured. Perhaps you have seen the TV advertisements by a local insurance company that encourages drivers to just get “legal”? That insurance company is targeting drivers who wish to buy only $60,000 limits of liability insurance.  What if you get hit by someone who only meets the state minimum for their state? Several states have even lower legally required limits, as low as $10,000 in some states!

As an insurance buyer, you need to know that your umbrella policy may not contain the important coverage that protects your family and the guests in your car from the underinsured and uninsured. At Bush Insurance, we represent several national insurance companies that offer this important protection.

So is  umbrella insurance worth it? Yes, it’s an inexpensive way to increase your auto liability protection but that is not the entire story. The personal umbrella can also protect you from the drivers who don’t bother to buy auto insurance or buy low limits.

Do umbrella policies that include this protection cost more? Yes, but what you are paying for is protection for all your family and friends that may be riding in your car. Isn’t that why you buy insurance?

If you have a question about your auto insurance or a personal umbrella, please give us a call at 615-794-9668 or drop us an email at socialmedia@bushins.com and we’ll make sure you have the coverage you need to protect your family and friends.  After all, we want you protected, because we’d like to have you for a customer for a long, long time.