In New York, in addition to mandatory liabililty insurance, motorists are required by law to carry either Uninsured Motorists Coverage or Supplementary Uninsured/Underinsured Motorists (SUM) coverage with their car insurance policies.

Uninsured/Underinsured Motorist

“Uninsured Motorists” (UM) coverage pays a policyholder and his passengers for damages the policyholder is legally entitled to recover from the owner or driver of an uninsured/underinsured vehicle because of injury suffered by the policyholder.  In other words, UM pays oneself, whereas liability insurance pays other motorists. UM pays for the policyholder’s medical bills, lost wages, and pain and suffering in the event that the driver who caused the damage does not have any insurance (uninsured) or does not have sufficient insurance (underinsured).  By definition, UM applies in a hit-and-run situation, and also when the other driver’s insurer is insolvent.  UM coverage is mandatory in every state, with statutory minimum limits often being the same as the liability limits set by individual state Financial Responsibility laws.

Supplementary Uninsured/Underinsured Motorist

Since Uninsured/Underinsured coverage pays for bodily injury the insured himself suffers, many policyholders want better protection with higher coverage limits.  The optional Supplementary Uninsured/Underinsured Motorist (SUM) coverage is available with higher limits, often up to the amount of the policy’s liability (bodily injury) limits.  Insurers are required to offer Supplementary Uninsured/Underinsured coverage in New YorkState.  Unlike the mandatory Uninsured Motorist coverage, Supplementary Uninsured/Underinsured coverage is optional and policyholders may decline this endorsement.  However, insurers must make this option available to consumers.

It should be noted that UM/SUM coverage is reduced or offset by any amount received from the other driver’s insurer.   It pays only for bodily injury claims, not property damage in almost every state.  Unlike Personal Injury Protection (PIP), which pays for the policyholder’s medical bills without regards to fault, UM/SUM applies only when the policyholder is legally entitled to receive benefits from the other driver, who has no or insufficient insurance.

To protect their assets against lawsuits, car owners often choose the highest liability coverage they can afford; liability insurance that pays other people.  When it comes to UM/SUM, consumers are advised to also purchase as high an amount as possible.  After all, UM/SUM pays for their own medical bills and lost wages.