Uninsured motorist coverage may help pay covered losses when another driver is at fault—meaning responsible for the crash—and has no liability insurance. Underinsured motorist coverage may help when that driver has insurance but its limit is too low. Who and what are protected depend on state law and the policy.
Liability Coverage May Pay for Harm You Cause; UM/UIM May Pay for Harm Another Driver Causes You
Auto liability coverage may pay covered claims when you are at fault for injuring someone or damaging that person's property. UM/UIM works in the other direction: it may pay covered losses suffered by you or another person protected by your policy when someone else is at fault and has no insurance or too little.
UM/UIM is an abbreviation, not one identical package. A quote may list separate coverage for injuries and property damage. Coverage names, required limits, selection rules, and rejection forms vary by state.
Uninsured vs. Underinsured: Two Different Triggers
Bodily injury concerns injuries to people. Property damage concerns damage to a vehicle or other covered property. The key difference between UM and UIM is whether the responsible driver has no applicable liability insurance or has some insurance with an insufficient limit.
The responsible driver has no applicable liability insurance
UM may apply when an at-fault driver has no insurance that can respond to the covered loss. Whether a hit-and-run driver qualifies depends on state law and policy terms.
- Bodily injury (UMBI)May pay eligible medical expenses, lost income, and other injury-related losses for people protected by your policy.
- Property damage (UMPD)May pay eligible damage to an insured vehicle or other covered property. Availability, limits, deductibles, and property protected vary.
The responsible driver has insurance, but its limit may not cover the loss
UIM may apply after the at-fault driver's available liability coverage is used and eligible losses remain, subject to your policy's limits and claim rules.
- Bodily injury (UIMBI)May pay additional eligible injury-related losses that remain after the responsible driver's bodily-injury liability coverage applies.
- Property damage (UIMPD)May pay part of eligible property damage left unpaid by the responsible driver's property-damage coverage. Many states or insurers do not offer this separately.
Both address eligible losses caused by another driver who is legally responsible, and both depend on state law, the policy, the people protected, and the limits selected.
UM begins with no applicable liability insurance. UIM begins with existing liability insurance that may be too low to cover the eligible loss.
Ask for the declarations page—the policy summary listing coverages, limits, and deductibles—and any form used to accept, lower, or reject coverage. Do not assume all four protections are included merely because a quote says “UM/UIM.”
Who Is Protected?
The policy's definition of an “insured person” controls who may receive protection. Use these questions to identify the people and vehicles that require confirmation.
You—the named insured
The named insured is the person or organization shown as an insured on the policy's declarations page. Confirm exactly which names are listed.
Family members who live with you
Ask which resident relatives or other household members qualify and whether owning a separate vehicle or policy changes their protection.
Passengers in an insured vehicle
Confirm which passengers qualify, which bodily-injury protection applies, and whether the policy lists any exceptions.
A driver you allow to use the vehicle
A permissive driver is someone who drives with the vehicle owner's permission. Ask whether that person qualifies for each UM/UIM protection.
You or family members away from the vehicle
Ask whether protection applies while riding in someone else's vehicle or after being struck by a vehicle while walking.
Other owned, work, rideshare, or regularly used vehicles
A regular-use vehicle is one available for frequent use but not necessarily listed on your policy. Ask about exclusions for these vehicles, motorcycles, and vehicles you own but did not insure.
What Can Bodily Injury Coverage Address?
UM/UIM bodily injury may help pay losses caused by an at-fault uninsured or underinsured driver. Depending on state law and the policy, covered losses may include medical expenses, lost income, funeral expenses, pain and suffering, or other injury-related damages.
UM/UIM is not the same as health insurance, medical payments coverage (often called MedPay), or personal injury protection (PIP). MedPay and PIP may pay certain expenses regardless of who caused the crash. Health insurance generally focuses on medical care.
UM/UIM is tied to losses caused by an at-fault uninsured or underinsured driver. Ask how these coverages work together; the same expense is not automatically paid twice.
What Do Limits Such as 100/300 Mean?
This commonly means up to $100,000 for one injured person and up to $300,000 total for all covered injured people in one accident. The policy—not the shorthand—controls how the limits apply.
Property-damage coverage generally has a separate dollar limit and may have a deductible—the amount deducted from a covered claim payment. Some states or insurers do not allow UM/UIM limits higher than your liability limits; others establish minimums or selection rules. Ask the insurer to show every available option and its annual price.
How to Choose Limits Without Guessing
There is no universal limit that fits every household. Use a repeatable comparison instead:
- Find out which choices your state allows. Ask whether the coverage is required, included unless you decline it, or optional.
- Separate bodily injury from property damage. Record each limit and deductible independently.
- Think about who could be injured. Review household drivers, regular passengers, dependents, income, and how a serious injury could affect the household.
- Understand your other financial protection. List applicable health insurance, PIP, MedPay, disability coverage, collision coverage, and emergency savings without assuming they replace UM/UIM.
- Price comparable alternatives. Ask for several UM/UIM limit options while keeping every other quote term the same.
- Document the final choice. Keep the declarations page and any signed selection or rejection form.
Property Damage: Compare UMPD With Collision
Uninsured motorist property damage (UMPD) and collision coverage can both relate to vehicle damage, but they respond to different situations. UMPD depends on an uninsured-motorist event. Collision generally applies to covered crash damage to your vehicle regardless of whether the other driver has insurance.
| UM/UIM property-damage coverage | Collision coverage |
|---|---|
| UMPD may apply when the at-fault driver has no insurance. UIMPD, if offered, may apply when that driver's property-damage limit is too low. | May apply to covered crash damage to your vehicle regardless of whether the at-fault driver has insurance. |
| It is not offered or structured the same way in every state. | It is generally optional, although a lender or leasing company may require it. |
| It may have a state-set or policy limit and a deductible that differs from collision. | It uses the collision deductible shown on the policy's declarations page. |
| Hit-and-run coverage may depend on vehicle contact, identification, witnesses, a police report, or prompt notice. | It may cover crash damage when the other driver cannot be identified, subject to the policy's terms. |
| The property protected can vary by state and policy. | It generally protects the insured vehicle rather than belongings inside it. |
If both coverages could apply to the same damage, ask the insurer which coverage would be used and which deductible you would owe. Do not remove collision merely because UMPD appears on a quote.
Hit-and-Run Coverage Has Special Conditions
UM coverage may apply to a hit-and-run or unidentified vehicle, but the conditions vary. Some policies require the vehicles to touch. Others may require a police report, witness information, photographs, or prompt notice to the insurer.
After a hit-and-run, prioritize safety, contact law enforcement, document the scene and damage, collect witness information, and notify the insurer promptly. Do not assume that a rule stated for one state or policy applies everywhere.
State Rules Can Change the Entire Decision
Depending on the state, UM or UIM may be required, included automatically unless you sign a form rejecting it, or optional coverage that insurers must offer. State rules also decide whether property-damage coverage is available, which forms must be signed, how an underinsured vehicle is defined, and how a claim payment is calculated.
Some states allow limits from more than one vehicle or policy to be added together, which is commonly called stacking. Some reduce a UM/UIM payment by amounts available from other insurance, which may be called an offset or setoff. These rules vary and should be confirmed for the policy being considered.
- Texas example: The Texas Department of Insurance states that insurers must offer UM/UIM and that a customer who declines it must do so in writing.
- California example: California's consumer guide describes separate UMBI, UIM, and UMPD protections and requires a signed waiver when uninsured motorist coverage is declined.
These examples apply to those states. Check the rules and forms for your own state rather than relying on a rule from somewhere else.
Before Settling With the Other Driver
If a UM/UIM claim may exist, contact your insurer before accepting a final settlement from the at-fault driver or that driver's insurer. Also contact your insurer before signing a release, which is a document that may end your right to request additional payment.
Your insurer may require notice or permission because it may have the right to recover money from the responsible party. Some claims also require proof that the at-fault driver's available liability limit has been used. Following the required process helps protect a later UM/UIM claim.
Questions to Ask Before Choosing UM/UIM
- Which UM and UIM bodily-injury limits are included, and which people are protected?
- Are uninsured and underinsured motorist limits combined in one coverage or listed separately?
- Is uninsured or underinsured motorist property damage included?
- What limits and deductibles apply to property damage?
- How does the policy define an uninsured and an underinsured vehicle?
- What rules apply to hit-and-run or unidentified vehicles?
- Can limits from multiple vehicles or policies be combined, and under what conditions?
- How do PIP, MedPay, collision, health insurance, or workers' compensation benefits for work-related injuries interact with a claim?
- Does the policy require the insurer's permission before I accept a settlement from an at-fault party?
- What signed form is required if I select lower limits or reject coverage?
Frequently Asked Questions
Is uninsured or underinsured motorist coverage required?
It depends on the state. A state may require the coverage, include it unless you decline it, or require insurers to offer it. Check your state insurance department and the documents provided with the quote.
Does UM/UIM coverage apply to hit-and-run crashes?
It may. Some policies require the vehicles to touch; others may require a police report, witness information, or prompt notice. Review the policy and report the incident promptly.
Does UM/UIM coverage pay for damage to your vehicle?
Only if the policy includes uninsured or underinsured motorist property-damage coverage and the claim meets its terms. Collision coverage is separate and may also pay for covered vehicle damage. Compare the events, limits, and deductibles for each.
How much UM/UIM coverage should you choose?
There is no universal amount. Compare the available limits and prices with the number of people protected, possible medical and income losses, other coverage, and the amount you could afford to pay yourself.
Sources and Editorial Method
This guide was created to support the UM/UIM decision on the Better Coverage Now Auto Coverage Decision Guide. It compares national consumer guidance with examples from state insurance regulators so state-specific rules are not presented as universal. Better Coverage Now is not an insurer, insurance agency, law firm, or government program.
- National Association of Insurance Commissioners: What Does Auto Insurance Cover?
- NAIC: A Shopping Tool for Auto Insurance
- NAIC: Consumer Auto Insurance
- Texas Department of Insurance: What Is Uninsured Motorist Coverage?
- California Department of Insurance: Automobile Insurance Guide
- Washington Office of the Insurance Commissioner: Uninsured or Underinsured Driver Claims