Underinsured motorist coverage

What is underinsured motorist coverage?

Underinsured motorist coverage, commonly called UIM, fills the gap when an at fault driver carries insurance, but not enough to cover the full extent of your damages.

It differs from uninsured motorist coverage, which applies when the at fault driver has no insurance at all rather than merely inadequate coverage.

Given how common minimum coverage limits are on the road, and how expensive serious injuries can be, this gap arises more frequently than most drivers realize until they need this coverage.

Purchasing adequate limits on your own policy is one of the more consequential insurance decisions a driver makes, precisely because it addresses a risk entirely outside your own control.

How does UIM coverage actually work?

The mechanics involve a specific sequence and some important limitations.

• The at fault driver's liability coverage is generally exhausted first
• Your UIM coverage then may apply to the difference, up to your policy limit
• Some policies reduce your UIM limit by what the at fault driver's insurance paid
• A UIM claim is typically pursued against your own insurer rather than the other driver
• Specific procedural requirements and notice deadlines apply and must be followed carefully

Why does the amount of UIM coverage you purchase matter so much?

Because it caps what is available to you regardless of how severe the injury actually is or how clearly the other driver was at fault.

Many drivers select the state minimum for liability coverage on their own policy without giving equivalent thought to UIM limits, not realizing this decision directly caps their own protection.

Reviewing and potentially increasing UIM limits is a meaningful, proactive step available before any accident occurs, unlike most insurance decisions that only reveal their consequences after a loss.

What complications arise in these claims?

A UIM claim technically proceeds against your own insurer, which creates an inherently adversarial relationship despite you being a paying customer of that same company.

Specific procedural steps, including notice requirements and sometimes consent before settling with the at fault driver, must be followed carefully or the UIM claim can be jeopardized entirely.

Disputes over the value of the underlying claim can arise just as they would against any other insurer, despite this being your own policy responding.

Common questions

How do I know if I have UIM coverage?

Check your declarations page, which will specify whether this coverage was selected and at what limit.

Do I have to sue the at fault driver before pursuing UIM coverage?

Not necessarily, though specific procedural rules apply and often require notifying your own insurer before finalizing any settlement with the other driver.

Can I increase my UIM limits at any time?

Generally yes, at renewal or by contacting your insurer directly. This is a proactive step worth considering before you need this coverage rather than after.