Uninsured and Underinsured Motorist Coverage: What Every U.S. Driver Should Know

Getting into a car accident can be stressful, but the situation can become even more complicated when the other driver does not have enough insurance to cover your injuries or vehicle damage.

Although most states require drivers to carry some form of auto insurance, not everyone follows these requirements. Some motorists drive without insurance, while others carry policies with liability limits that may be insufficient to cover the full cost of a serious accident.

This is where uninsured motorist (UM) and underinsured motorist (UIM) coverage can make a significant difference.

These types of auto insurance coverage are designed to help protect you financially when another driver causes an accident but does not have adequate insurance.

However, many drivers do not fully understand how this protection works, what expenses it covers, or whether they should include it in their auto insurance policy.

In this guide, we explain uninsured and underinsured motorist coverage, the differences between them, how claims work, and what drivers in the United States should consider before choosing their coverage.

What Is Uninsured Motorist Coverage?

Uninsured motorist coverage, commonly called UM coverage, is a type of auto insurance that can help pay for certain losses when you are involved in an accident caused by a driver who does not have the required liability insurance.

Imagine you are driving through an intersection when another vehicle runs a red light and crashes into your car.

You suffer injuries and require medical treatment, but the other driver has no auto insurance.

Without appropriate protection, recovering compensation for your losses could become difficult, particularly if the at-fault driver does not have sufficient personal assets.

Depending on your policy and state regulations, uninsured motorist coverage may help pay for eligible expenses such as:

• Medical bills resulting from the accident.
• Hospital and emergency treatment.
• Certain rehabilitation expenses.
• Lost wages due to accident-related injuries.
• Other covered damages associated with bodily injury.

Some policies also offer uninsured motorist property damage coverage, which may help pay for damage to your vehicle caused by an uninsured driver.

However, property damage coverage is not available in every state, and eligibility, deductibles, exclusions, and claim requirements vary.

What Is Underinsured Motorist Coverage?

Underinsured motorist coverage, commonly called UIM coverage, protects you in certain situations where the driver responsible for an accident has insurance but does not carry enough liability coverage to pay for your covered losses.

For example, suppose another driver causes an accident that results in $100,000 in covered bodily injury damages.

However, the driver’s liability insurance policy has a bodily injury limit of only $25,000 per person.

After the at-fault driver’s insurance pays the applicable amount, there may still be a substantial financial gap.

If your policy includes applicable underinsured motorist coverage, it may help cover some of the remaining eligible damages, subject to your coverage limits, state laws, and policy conditions.

This protection can be especially valuable when an accident results in serious injuries, extended medical treatment, or significant lost income.

Uninsured vs. Underinsured Motorist Coverage: Key Differences

Although these two coverage types are closely related, they protect against different situations.

Feature	Uninsured Motorist (UM)	Underinsured Motorist (UIM)
At-fault driver has insurance	No qualifying liability coverage	Yes, but insufficient coverage
Main purpose	Protection against uninsured drivers	Protection against inadequate insurance limits
Medical expenses	May be covered under UM bodily injury	May be covered under UIM bodily injury
Lost wages	May be covered	May be covered
Vehicle damage	Depends on available property damage coverage	Depends on state and policy
Coverage limits	Selected policy limits	Selected policy limits
State requirements	Vary by state	Vary by state

Both coverage types can provide an additional layer of financial protection when another driver causes an accident.

However, they do not replace your regular auto liability insurance, collision coverage, or health insurance.

What Does Uninsured Motorist Coverage Pay For?

The expenses covered depend on whether your policy includes bodily injury coverage, property damage coverage, or both.

1. Medical Expenses

Uninsured motorist bodily injury coverage may help pay eligible medical expenses resulting from an accident caused by an uninsured driver.

Depending on the circumstances, this may include:

• Emergency room treatment.
• Hospital stays.
• Doctor appointments.
• Diagnostic tests.
• Surgery.
• Physical rehabilitation.

Coverage is subject to the policy’s terms and applicable state law.

2. Lost Income

A serious accident can prevent you from working for days, weeks, or even months.

Some uninsured and underinsured motorist bodily injury policies provide compensation for qualifying lost wages.

For example, if you are injured in an accident caused by an uninsured driver and cannot return to work for several weeks, your policy may help compensate for eligible lost income.

3. Pain and Suffering

Depending on state law and policy provisions, bodily injury coverage may also provide compensation for certain non-economic damages, including pain and suffering.

The amount depends on the circumstances of the accident, the injuries involved, and applicable legal requirements.

4. Vehicle Damage

Uninsured motorist property damage coverage may help pay for eligible vehicle repairs when an uninsured driver damages your car.

However, some states have restrictions or deductibles, and certain policies may not offer this protection.

If you already have collision coverage, it may also help pay for damage to your vehicle regardless of whether the at-fault driver has insurance, subject to your deductible.

How Does an Uninsured Motorist Insurance Claim Work?

Understanding the claims process can help you respond appropriately after an accident involving an uninsured or underinsured driver.

Although procedures vary between insurers and states, the general process often includes the following steps.

Step 1: Report the Accident

Contact the appropriate authorities when required and obtain an accident report.

Record the other driver’s information, vehicle details, insurance information, and contact details for witnesses.

If the other driver admits they do not have insurance, document that information.

Step 2: Notify Your Insurance Company

Contact your insurer as soon as reasonably possible.

Explain what happened and inform them that the other driver appears to be uninsured or underinsured.

Your insurance company can explain which coverage provisions may apply.

Step 3: Collect Supporting Documents

Keep copies of relevant documents, including:

• Police accident reports.
• Medical records.
• Medical bills.
• Photographs of vehicle damage.
• Repair estimates.
• Employment and lost-wage documentation.
• Witness information.

Accurate documentation can help support your claim.

Step 4: Insurance Investigation

Your insurer may investigate the accident, determine fault, review available coverage, and assess the damages.

For an underinsured motorist claim, the insurer may also need information about the other driver’s liability policy and payments.

Some states and policies have specific requirements before an underinsured motorist claim can proceed.

Step 5: Claim Evaluation

The insurer evaluates eligible losses according to the policy and applicable law.

If the claim is approved, payment is generally limited by the applicable coverage provisions and limits.

You should review any settlement documents carefully before accepting an offer.

How Much Uninsured Motorist Coverage Should You Have?

There is no single coverage amount that is suitable for every driver.

The appropriate limit depends on your financial circumstances, state requirements, household needs, and the amount of protection you want.

Consider these factors before selecting your coverage.

Your Financial Situation

If you have significant savings, property, or other financial assets, a serious accident could create substantial financial exposure.

Higher uninsured and underinsured motorist limits may provide additional protection, depending on the policy.

Your Health Insurance Coverage

Your health insurance may cover certain accident-related medical expenses.

However, it may not cover every financial consequence of an accident, such as qualifying lost wages or certain non-economic damages.

UM and UIM bodily injury coverage may provide additional protection.

Your State’s Insurance Requirements

Insurance requirements differ across the United States.

Some states require uninsured motorist coverage, while others make it optional or provide specific selection and rejection procedures.

Underinsured motorist requirements also vary.

Check your state’s insurance department for the rules that apply to your location.

Your Existing Auto Insurance Limits

Review your current bodily injury liability limits.

In some states and under certain policy structures, UM and UIM limits may be selected in relation to your liability coverage.

Your insurer can explain the available options and any applicable restrictions.

Which States Require Uninsured Motorist Coverage?

Insurance laws vary significantly between states.

Some states require drivers or insurers to provide uninsured motorist coverage, while others require insurers to offer it but allow consumers to reject it under specified conditions.

For example:

• Illinois: Generally requires uninsured motorist bodily injury coverage as part of qualifying auto liability policies.
• Maryland: Requires uninsured motorist coverage subject to state requirements.
• New York: Requires uninsured motorist bodily injury coverage for qualifying policies.
• North Carolina: Requires uninsured motorist coverage under applicable auto insurance requirements.
• Virginia: Has specific uninsured motorist coverage provisions and requirements.
• California: Insurers generally must offer uninsured motorist coverage, although consumers may reject certain coverage in writing.

These are general examples, not a complete list of state insurance laws.

Requirements, minimum limits, rejection procedures, and available coverage options can change.

Drivers should verify current rules through their state insurance department before purchasing or changing a policy.

Is Uninsured Motorist Coverage Worth It?

For many drivers, uninsured motorist coverage can be a valuable addition to an auto insurance policy.

Even if you follow traffic laws, you cannot control whether another motorist carries adequate insurance.

A single accident can result in substantial medical expenses, lost income, and other financial losses.

Here are some situations where this protection may be particularly useful.

You regularly drive in busy areas: More time on the road can increase your exposure to accidents involving other motorists.

You have limited emergency savings: An unexpected accident can create financial difficulties if the responsible driver has no insurance.

You have family members who depend on your income: Coverage may help address certain financial losses resulting from accident-related injuries.

You want additional financial protection: UM and UIM coverage can provide protection beyond what the other driver’s insurance may offer.

However, you should compare the additional premium with the benefits, limits, and exclusions before making a decision.

Does Uninsured Motorist Coverage Pay for Hit-and-Run Accidents?

In some circumstances, yes.

Uninsured motorist bodily injury coverage may apply when you are injured in a qualifying hit-and-run accident.

However, state laws and insurance policies determine whether the incident qualifies.

Some policies require physical contact between vehicles, while others may have different requirements.

There may also be specific reporting deadlines and evidence requirements.

If you are involved in a hit-and-run accident:

1. Contact law enforcement.
2. Record the location and time.
3. Photograph any available evidence.
4. Collect witness information.
5. Notify your insurance company promptly.
6. Review the policy’s hit-and-run provisions.

Do not assume every hit-and-run accident automatically qualifies for uninsured motorist benefits.

Does Uninsured Motorist Coverage Replace Collision Insurance?

No. These coverage types serve different purposes.

Collision insurance generally helps pay for damage to your vehicle resulting from a collision with another vehicle or object, regardless of who caused the accident, subject to the policy deductible and terms.

Uninsured motorist property damage coverage may provide protection when an uninsured driver damages your vehicle.

The main differences include:

Feature	Collision Coverage	UM Property Damage
Covers vehicle damage	Yes	Where available
Requires another driver to be uninsured	No	Generally yes
Applies to single-vehicle collisions	Generally yes	Generally no
Deductible	Usually applies	Depends on state and policy
Availability	Widely available	Varies by state and insurer

If your vehicle is damaged by an uninsured driver, your insurer can explain which coverage may apply.

Seven Things to Check Before Buying Uninsured Motorist Coverage

Before adding UM or UIM protection to your policy, review the following details.

1. Coverage limits: Understand the maximum amount available for bodily injury and property damage claims.
2. State requirements: Confirm whether your state requires coverage or specific selection procedures.
3. Policy exclusions: Review situations where the insurer may deny or limit coverage.
4. Hit-and-run provisions: Understand the evidence and reporting requirements.
5. Deductibles: Check whether you must pay a deductible for property damage claims.
6. Premium differences: Compare the additional cost of different coverage limits.
7. Claim procedures: Understand notification deadlines and documentation requirements.

Reading the policy carefully can help you avoid unexpected problems when filing a claim.

Frequently Asked Questions

What is the difference between uninsured and underinsured motorist coverage?

Uninsured motorist coverage generally applies when an at-fault driver has no qualifying liability insurance. Underinsured motorist coverage may apply when the at-fault driver has insurance but insufficient limits to cover your eligible losses.

Is uninsured motorist coverage mandatory in the USA?

No single rule applies nationwide. Requirements vary by state. Some states require coverage, while others require insurers to offer it and allow drivers to reject it under specified conditions.

Does uninsured motorist coverage pay for car repairs?

It may, if your policy includes uninsured motorist property damage coverage and the accident qualifies. Collision coverage is another option that may pay for covered vehicle damage.

Can I use uninsured motorist coverage if I am a passenger?

Depending on the policy, state law, and circumstances, passengers may qualify for uninsured motorist bodily injury benefits.

Does uninsured motorist coverage have a deductible?

Bodily injury coverage generally does not have a standard deductible, but property damage coverage may have one depending on state law and policy provisions.

Does uninsured motorist coverage protect my family?

Coverage may extend to certain family members and other insured individuals, depending on the policy definition of an insured person.

Review your policy to understand who qualifies.

Can I have both UM and UIM coverage?

Yes. Many auto insurance policies offer both types of protection, although availability and coverage structures differ by state and insurer.

Is uninsured motorist coverage included in full coverage car insurance?

Not necessarily. The phrase full coverage is not a standardized insurance policy. A policy with liability, collision, and comprehensive coverage does not automatically include UM or UIM protection.

Check your declarations page to confirm whether these coverages are included.

Final Thoughts

Uninsured and underinsured motorist coverage can provide important financial protection for drivers in the United States.

Even responsible motorists can become involved in accidents caused by people who have no insurance or insufficient liability limits.

UM coverage may help protect against losses caused by uninsured drivers, while UIM coverage can help address certain financial gaps when the responsible driver’s insurance is insufficient.

Before choosing an auto insurance policy, review your state’s requirements, compare available coverage limits, and understand the exclusions and claim procedures.

Do not focus exclusively on the monthly premium. Consider how much financial protection the policy could provide when an unexpected accident occurs.

The right car insurance policy should protect more than just your vehicle. It should also help protect your financial well-being when another driver’s lack of insurance puts you at risk.