Quick answer: Uninsured motorist (UM) coverage pays if you are hit by a driver with no insurance, or in a hit-and-run. Underinsured motorist (UIM) coverage pays if the at-fault driver's insurance is not enough to cover your losses. Both are part of your own auto policy and pay up to its limits. Some states let you add together the limits of several vehicles or policies, called stacking, and others do not.
On this page:
- What UM and UIM coverage covers
- UM versus UIM
- Is the coverage required?
- Limits and deductibles
- What stacking means
- What to do
- Next steps
What UM and UIM coverage covers
The Texas Department of Insurance explains that uninsured/underinsured motorist coverage pays if you are hit by someone who did not have insurance or did not have enough to pay your medical and car repair bills, and that it also pays in a hit-and-run accident. In legal terms, Texas defines it as coverage that protects insureds who are legally entitled to recover from owners or operators of uninsured or underinsured vehicles damages for bodily injury, sickness, disease or death, or property damage. In other words, it pays what the at-fault driver would owe you, but cannot or does not pay. The kinds of damages are described in what damages you can recover.
UM versus UIM
| Uninsured motorist (UM) | Underinsured motorist (UIM) | |
|---|---|---|
| When it applies | The at-fault driver has no insurance, or leaves the scene | The at-fault driver has insurance, but too little |
| Who pays | Your own insurer | The other driver's insurer first, then your insurer if the state's rules allow |
| Limit | Your UM limit | Your UIM limit, often reduced by what the other insurer pays |
The exact mechanics of UIM differ by state. In Texas, underinsured coverage pays the amounts you are legally entitled to recover, not to exceed the policy limit, and reduced by the amount recovered or recoverable from the insurer of the underinsured vehicle. Utah defines an underinsured vehicle differently: one covered by a liability policy that has insufficient liability coverage to compensate fully the injured party for all special and general damages.
Is the coverage required?
Rules differ. In Texas, insurers must offer the coverage and you must tell the company in writing if you do not want it, and the statute says it does not apply if an insured named in the policy rejects it in writing. Wyoming's chapter on uninsured motorist coverage is similar for UM: the coverage must be provided unless the named insured rejects it (W.S. 31-10-101).
Limits and deductibles
UM and UIM are not unlimited. The Texas regulator says uninsured/underinsured motorist coverage has dollar limits, the most the company will pay, and that in Texas you must pay a deductible on uninsured and underinsured claims. The declarations page at the front of your policy summarizes your coverages, limits and deductibles, so find yours before you need it.
What stacking means
Stacking means adding together the UM or UIM limits of more than one vehicle or policy, so a $50,000 limit on each of two cars could behave like $100,000 after one accident. States split on it. Utah's statute, for example, says that the limit of underinsured motorist coverage for two or more vehicles may not be added together, combined or stacked, with exceptions such as a covered person injured as a pedestrian. Other states allow it, restrict it, or leave it to policy wording and court decisions. The UM/UIM Stacking Calculator shows what your state says.
What to do
- Check your policy now. Look at your UM/UIM limits, deductible and any rejection you signed.
- Know that it is a claim like any other. Your own insurer evaluates it, so the steps in how a personal injury claim works still apply.
- Account for other claims on the money. See what a medical lien is.
Next steps
The personal injury calculators cover every state, and our methodology page explains how each figure is verified. For advice on your own case, talk to a licensed attorney in your state.