Taylor Swift : If you’re in an accident and the other driver is uninsured motorist  or underinsured motorist , will you be covered? Do you think I should buy this coverage for auto insurance and will the auto insurance rate increase?

Response : If you have bought the uninsured motorist or underinsured motorist coverage you will be covered for this. Let me explain to you what an uninsured motorist or underinsured motorist coverage under car insurance means.

Uninsured or underinsured motorist coverage can pay for injuries to you and your passengers, and in some locations damage to your property, when there is an accident and the other driver is both legally responsible for the accident and considered “uninsured” or “underinsured.”

An uninsured driver is someone who did not have any insurance, had insurance that did not meet state-mandated minimum liability requirements, or whose insurance company denied their claim or was not financially able to pay it. A hit-and-run driver also counts as uninsured as it relates to bodily injury (UMBI).

An underinsured driver is someone who had insurance that met minimum legal requirements, but did not have payment limits high enough to pay for the damage caused by the accident. In these situations, UM or UIM can pay you for your damages. It is important to note that uninsured and underinsured motorist coverages are separate, although in many states they can or must be purchased together.

At this time, I think it is most advisable to go for an auto insurance policy which covers you for uninsured motorist and also underinsured motorist.  The reason for this is because of the present economical scenerio most drivers are cutting on their auto insurance limits to get low auto insurance premium and reduce their expense. Some of them are in fact not buying insurance at all. . As per the Insurance Information Institute one driver out of every seven in the US is believed to have no automobile insurance. This would mean that 14% of the drivers are uninsured and only 86% drivers are insured. As per the Insurance Information Institute one driver out of every seven in the US is believed to have no automobile insurance. This would mean that 14% of the drivers are uninsured and only 86% drivers are insured. Thus those who have insurance will have to bear the brunt and pay higher premiums or make sure that they are properly insured and have all the apprioprate car insurance coverage and limits.

Reader: What does my credit rating have to do with my auto insurance quote or rating?

Low auto insurance rates can be obtained with good credit.

Auto insurance quote credit rating

Response : One thing you need to remember when you review car insurance or compare auto insurance quote to get low auto insurance rate is that your credit score should be good. Normally one would think that there should be no relation between the car insurance rate and a credit score.

The credit score is generated from a person credit history. Credit history is the score of the time-line and the default in paying your bills like the telephone bills, loans or any outstanding bills. The insurance premium for any risk including the auto insurance is based on the probability of loss; the higher the probability of loss, the higher the risk and the higher the rating.

The actuarial department of the insurance company has analyzed the “insurance score” and based the auto insurance premium on this.  The “insurance score” is generated from a numerical rating of the person credit history. Based on the “insurance score” the underwriting of the auto insurance is done.  The insurance companies have found that if the credit score of a person is low than the risk is higher. Statistically it has been found that a person with a low score for credit history is more likely to place a claim or meet with an accident than one with a higher score. This may be the case since a person with poor credit has financial problems and is under stress.

So the next time you reveiw car insurance coverage or compare auto insurance quote, whether online or through an agent, please check your credit score. If it is good – you have a ticket to low auto insurance rates. The agent is not giving you low auto insurance rates – you are entitled to low auto insurance rates.