Uninsured motorist coverage?

[nawhite]

I live in a state where I can choose to get uninsured motorist (UM) coverage or not. Having it on both of my cars increases my premiums by about 25 percent because I don't really drive much (public transit and walkable neighborhood for the win). Currently I'm looking at $235 every 6 months if I include it UM and $178 if I don't. My question is what situation does UM coverage pay out that I wouldn't already be covered for now that my health insurance has a yearly out of pocket max and a no lifetime maximum benefit.

If I'm in a crash thats my fault, the UM is irrelevant because my standard liability car insurance pays out.

So if it is just me in the car and an uninsured person hits me and its their fault:
If I die, my life insurance pays out. If I get horribly disabled, my Long Term Disability coverage pays out. If I have high hospital bills, my short term disability covers my earnings while I'm in the hospital and my health insurance pays the hospital with me paying co-pays etc up to my yearly out of pocket max which is like $12k or something perfectly reasonable (significantly less than emergency fund + credit card limit)

If I have a friend in the car and an uninsured person hits me, then I could see my UM coverage paying for my friend's expenses. In my head my friend should have coverage for themselves so should I care? Not to mention this is a crazy low probability event given how little I drive let alone with a passenger not my wife.

Can someone explain to me where this coverage is used now that the gaps in health insurance have been closed by Obamacare?

[msilenus]

http://www.mrmoneymustache.com/2011/06/02/insurance-a-tax-on-people-who-are-bad-at-math/

Sounds like you're covered.  If you can afford to replace the car, self-insure.

[CDP45]

It could cover the out of pocket max that you would have to pay if you just had health ins, but very good summary of the possibilities. Health insurance doesnt replace income and I do to think a lot of people have short/long term disability. Insurance is really good for people who have assets to protect.

[dragoncar]

I think with LTD you are set.  But not many people have LTD and once you are retired, LTD may not end up paying that much (since your income will be low).  I carry UM because it's not that expensive, but I'm glad you asked the question and look forward to answers from others.  I don't carry LTD because the plan we have at work only really kicks in once I'm basically brain dead  (I can technically still do my job as a paraplegic).

[lackofstache]

It sounds like you're covered w/o Uninsured Motorist as long as you can cover paying for another car if something happens. If you're carrying comprehensive & collision, I'd suggest you also have uninsured. Mine doesn't cost nearly that much compared to liability, so I keep mine. You may wanna drop underinsured motorist as well, as long as you're covered all the way around.

[unpolloloco]

You may also want to look at the rates of uninsured motorists on the road in your area before you make your decision.  Sounds like you're covered on the personal injury side (except "pain and suffering" - whatever that means), but the gap that it's currently filling is property damage.  If an uninsured person (or someone who commits a hit and run) hits you, you're out of pocket for damages to your car if they don't have the cash to pay (you could still sue them and win, but you'd be unlikely to actually be able to collect).

[nawhite]

We don't keep comprehensive or collision on our cars as they are worth about $4500 each and they are completely paid off. I'd rather save the $20/month we'd have to pay for that. So we're paying for property damage to our car regardless of whether or not the person who hits us has insurance.

As for number of uninsured people on the road, I've read about 1 in 6 drivers are uninsured in our area which is about the national average.

I went ahead and dropped the UM coverage this morning. Currently at $177 per 6 months for 2 cars 2 drivers at 100/300/100. I'm debating upping to 500/500/100 as that would be $200/6 months but its between that or pay for $1M in Umbrella at $140 / year. What do other people keep as coverage levels?

[lackofstache]

You may need igher limits for the umbrella anyway, my company requires 250/500/100 to do the umbrella. I have them there w/o the umbrella for now.