Understanding Nevada’s Insurance Requirements
Nevada law requires all drivers to carry minimum liability insurance coverage of:
- $25,000 for bodily injury per person
- $50,000 for bodily injury per accident
- $20,000 for property damage
Liability insurance covers damages when you are at fault for an accident. However, if the other driver caused the accident, their liability insurance should cover your injuries. Unfortunately, many drivers either do not carry insurance at all or maintain only the minimum required coverage, which may not fully compensate your losses.
What Is Uninsured/Underinsured Motorist (UM/UIM) Coverage?
UM/UIM coverage is an optional insurance policy add-on that protects you if you are injured by a driver who:
- Has no insurance (Uninsured Motorist coverage), or
- Has insufficient insurance to cover your damages (Underinsured Motorist coverage).
All Nevada insurers must offer UM/UIM coverage, but drivers can legally reject it in writing. Many drivers decline this coverage without fully understanding its importance, leaving themselves vulnerable in the event of a serious accident.
How Does UM/UIM Coverage Work?
UM/UIM coverage supplements your protection by paying for compensatory damages such as:
- Medical expenses
- Lost wages
- Pain and suffering
Note: UM/UIM coverage does not cover punitive damages.
When Does UM/UIM Coverage Apply?
- Uninsured Motorist Coverage: Applies if the at-fault driver has no insurance.
- Underinsured Motorist Coverage: Applies when your damages exceed the at-fault driver’s liability limits. You may recover the difference up to your UM/UIM policy limits.
Unlike some states, Nevada does not require you to exhaust the at-fault driver’s liability coverage before accessing your underinsured coverage.
UM/UIM Coverage in Action: Sample Scenarios
Scenario 1:
John is rear-ended by Steve, who has minimum liability coverage ($25,000 per person). John’s damages total $30,000 (medical bills and lost wages). Steve’s insurer pays John $25,000, and John’s underinsured motorist policy covers the remaining $5,000 plus compensation for pain and suffering.
Scenario 2:
Stacey is side-swiped by Joe, who also carries minimum coverage. Joe’s insurer offers only $20,000 for Stacey’s $30,000 damages. Stacey’s underinsured motorist policy covers the $10,000 difference plus additional compensation for pain and suffering.
Why You Need UM/UIM Coverage
The nature and severity of injuries, combined with unpredictable insurance coverage levels of other drivers, make it impossible to fully anticipate your needs after an accident. Purchasing adequate UM/UIM coverage is the best way to protect yourself against serious financial loss.
Your health and financial security are too important to risk.
