Ensuring that every driver has adequate insurance is crucial in an at-fault state like Colorado. An accident victim would have no way to ensure that the at-fault driver has means to pay their expenses after an accident if auto insurance was not required.
Minimum Coverage Required in Colorado (Auto Insurance Policy)
Bodily Injury Liability - $25,000 per person / $50,000 per accident; and
Property Damage - $15,000 per accident
While this may sound like plenty of coverage, medical expenses very quickly add up after a significantly serious car wreck.
Thus, to ensure adequate coverage for their expenses after an accident, many drivers purchase underinsured motorist (UIM) protection.
UIM protection will allow an injured person to collect from their OWN insurance carrier if they are not sufficiently compensated by the liability carrier (insurance company of the driver at fault).
To illustrate this, assume another driver hit you and you suffered $75,000 in damages. If the at-fault driver only carried the minimum coverage required by law, ($25,000), you would be responsible for the remaining $50,000. However, if you have enough UIM coverage, your OWN insurance company should compensate you for the remaining balance.
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