Are You Covered?

As a former trial attorney with a successful law practice for 12 years, I appreciate that discussing insurance coverage is about as exciting as watching somebody else's kid play goalie in a pee wee soccer game. But, keep reading because I'm about to explain a little known part of your automobile insurance policy that actually covers you while bicycling, jogging, walking or performing any other activity in the midst of street traffic.

Take a look at the declarations page of your auto policy—a fancy name for the paper sent to you by your insurance company that summarizes the types of coverage included in your policy. Likely, you'll see words and titles like "comprehensive," "collision" or "medical pay." Now, look for an "uninsured motorist" and/or "underinsured motorist" reference (it may be abbreviated as UM and UIM). Do you see it listed? If not, call your insurance company to determine whether you have both. If UM and UIM coverage are not currently part of your policy, order them immediately—especially if you jog or ride a bike near vehicle traffic. Why? Keep reading.

More: Important Safety Tips for Commuting by Bike

What is Uninsured and Underinsured Motorist Coverage?

Let's say you're driving your car and another car crashes into you. In the best case scenario, and assuming the crash was the other person's fault, the other driver carries a large auto-insurance policy that will cover all of your property damage (car), medical bills (if you're injured), and any pain and suffering or other out-of-pocket expenses you incur.

But, what if the person that crashes into you was driving without auto-insurance? That's when your uninsured motorist coverage comes into play—if you have it. Since the person who hit you has no insurance, all of your property damage, medical bills and any pain, suffering or other out-of-pocket expenses will be paid by your own insurance company—up to your UM limits.

Similarly, let's assume that the driver who hits you has auto-insurance, but only pays for what's required under state law—most state minimums amount to a measly $20,000. If your expenses total more than $20,000, you would make a claim on your own underinsured motorist coverage (underinsured meaning the person that crashed into you does not carry enough insurance to pay for the fair value of your losses). In this scenario, you would obtain the first $20K from the other driver's insurance company (with your insurance company's consent), then make a claim for the remainder with your own insurance company up to the UIM limits.

More: Freedom From the Grind: Become a Bike Commuter

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