Georgia Adjuster Practice Test

What type of insurance provides coverage for damages caused by an underinsured driver?

1. Liability Coverage

2. Comprehensive Coverage

3. Underinsured Motorist Coverage

4. Collision Coverage

The correct answer is: Underinsured Motorist Coverage

Underinsured Motorist Coverage is specifically designed to protect insured individuals when they are involved in an accident with a driver who does not have sufficient insurance to cover the damages incurred. This type of coverage ensures that, if the at-fault driver has lower liability limits than required to fully compensate for the damages, the insured can make a claim against their own policy to cover the difference. This form of coverage is essential as it is not uncommon for drivers to carry insurance limits that fall short of the expenses that arise from serious accidents. It acts as a safety net, allowing for a sense of security in situations where the other party is unable or unwilling to pay the full amount needed to cover medical expenses, vehicle repairs, and other costs related to the accident. Liability Coverage relates to damages you may cause to others, Comprehensive Coverage protects against non-collision-related incidents, and Collision Coverage helps cover damages to your own vehicle resulting from a collision with another vehicle or object. Each of these options serves distinct needs and does not provide the protections associated with underinsured drivers, which is why Underinsured Motorist Coverage is the most suitable option for this scenario.