Most states today require insurers to offer uninsured motorists insurance and documentation if rejected. As noted by Insurance.com:
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."
Mose states that prohibit outright rejection require minimum limits, typically around $25,000. For larger businesses limits are often set at policy limits of $1,000,000 with a minimal additional premium charge. The original intent of this insurance was to provide some financial remedy for the injured driver/passengers when the responsible party is uninsured.
There is a common misunderstanding as to who has access to this insurance. I have a client that several years back had U/M insurance at policy limits, simply because the insurer saw it as a "throw in" for an insured that had a large deductible. At the time the client had an employee involved in an automobile accident with another driver who was uninsured. The thinking at the time was that the employee would be covered by workers compensation for injuries suffered, since it was work related. The client thought the work comp benefits would be the sole remedy for the injured employee.
Since the other driver had no insurance the injured employee had the ablilty to make an uninsured motorists claim against his employer's automobile policy. At the time we thought "How can the employee access the employer's auto insurance without their permission"? The scope of uninsured motorists coverage extends "Insured" status to anyone occupying a covered auto, including an employee, as noted in the sample form (PDF).
Now one might think that if an employee recovered damages for bodily injury under uninsured motorists, it would set off or reduce the payments made by the workers compensation insurer. Often the damages that are claimed under uninsured motorists pertain to such things as pain and suffering that are not compensable under workers compensation. This allows the injured employee to "double dip" for sustained injuries. In my situation it was to the tune of several hundred thousand dollars.
What to do to prevent this? Always reject higher limits where offered. Accept only the minimum statutory limits required and reject the coverage outright in those states that permit it. If you don't have the coverage or have only minimal limits, it will prevent or limit this double recovery. It is essential to maintain the signed rejection document (PDF) to validate your intent.
The only exception to this rule might be where the business owners seek to include this broadened coverage feature for personal protection. In these situations the specific vehicles need to be identified as the ones where full uninsured motorist coverage is desired.
