Question: What does Economic Only UM coverage cover? Why would you sell it and not the Uninsured / Underinsured?
Answer: It appears you are speaking of Economic-Only Uninsured Motorist (EOUM) insurance which is available in Louisiana as an optional coverage.
According to the Louisiana Department of Insurance, Uninsured/Underinsured Motorist Bodily Injury (UMBI) coverage pays benefits to you if your car is hit by a driver who has no insurance or too little insurance to pay for the full amount of your injuries. Any bodily injury you or an occupant of your vehicle suffers due to an accident caused by another driver is covered under this policy. Hit-and-run drivers may be classified as uninsured motorists if there is a disinterested witness to the accident.
In LA you may choose to purchase Uninsured Motorist Economic-Only coverage. This coverage is the same as uninsured motorist coverage except that it covers only the actual costs of injuries to you and the occupants of your vehicle. Pain and suffering are not included under this coverage. Economic and non-economic losses are defined in Louisiana Revised Statute (RS) 22:680. Here it states that:
Economic losses are defined as those which can be measured in specific monetary terms including, but not limited to, medical costs, funeral expenses, lost wages, and out of pocket expenses.
Non-economic losses are defined as losses other than economic losses and include, but are not limited to, pain, suffering, inconvenience, and mental anguish and other non-economic damages otherwise recoverable under the laws of this state.
You can choose on auto insurance form which type of coverage you want. If you choose Economic Only than the form typically states something to the effect of:
I select Economic-Only UMBI Coverage which will compensate me only for my economic losses with the same limits as my Bodily Injury Liability Coverage; or
I select Economic-Only UMBI Coverage which will compensate me only for my economic losses with limits lower than my Bodily Injury Liability Coverage limits and then you name these limits - $XX each person, $XX each accident.
One may want to choose Economic-Only Uninsured Motorist Bodily Injury if you wish to have coverage for your actual medical bills if you are injured by an uninsured motorist but do not feel the need to have to put in a claim for pain and suffering and other non-economical losses you may suffer in injured by someone driving without insurance. Because you are not getting as much protection with this coverage having economic-only will be cheaper than having full UMBI coverage.
Those insurers in Louisiana who offer, Economic Only Uninsured Motorist (EOUM) coverage has it so this coverage also includes Economic Only Underinsured Motorist Coverage. While as you saw earlier you can get EOUM with limits the same as your bodily liability limits or lower limits than your BI coverage but this coverage limit cannot exceed the Bodily Injury Liability limits.
Insurance companies in Louisiana must offer Uninsured / Underinsured Motorist Bodily Injury per LA laws but not all companies offer economic-only uninsured motorist. So an insurance company should not offer EOUM without offering full UMBI.
By law in Louisiana, your policy will include UMBI Coverage at the same limits as your bodily injury liability coverage unless you request otherwise. If you wish to reject UMBI coverage, select lower limits of UMBI Coverage, or select Economic-Only UMBI coverage, you must complete a form and return it to your insurance agent or insurance company. As mentioned earlier Economic-Only UMBI coverage may not be available from all insurance companies but Uninsured / Underinsured Motorist coverages should be.