Uninsured vs. Underinsured Motorist Coverage in North Carolina

By the FigureMyTax Editorial Team · How we calculate

North Carolina requires both. A driver is underinsured when the liability limits are less than your total damages, and UIM pays from the first dollar of your claim beyond what the liability coverage paid, with no setoff. Contributory negligence rules from case law can bar the claim.

Uninsured

An uninsured vehicle has no bodily injury liability insurance in at least the required amounts, has insurance whose company denies coverage or is bankrupt, or lacks the bond or deposit; hit-and-run vehicles are covered when the accident is reported promptly (G.S. 20-279.21(b)(3)). You must give your insurer notice 60 days before suing an uninsured motorist, though failing to do so does not require dismissal.

Underinsured and how UIM pays

Under section (b)(4), a highway vehicle is underinsured when the sum of its liability limits is less than the total damages you sustained. UIM applies once those limits are paid or tendered and pays from the first dollar of your claim beyond what the liability coverage paid, up to your UIM limit, with no setoff or credit except workers' compensation. With $100,000 of UIM, $50,000 paid and $250,000 of damages, UIM pays up to $100,000.

Fault

We found no comparative fault statute. North Carolina follows contributory negligence, from court decisions that we did not read, which is widely described as barring recovery if you were negligent at all, with exceptions such as last clear chance. Ask an attorney about your facts. The calculator treats any fault above zero as a bar.

Deadlines

Most injury actions must be commenced within 3 years (G.S. 1-52(16)); a person under 18 may bring the action within the time limited after the disability ends (1-17). North Carolina has no no-fault threshold.

Next steps

Stacking is a separate question; see our statute post and the explainer, then use the North Carolina UM/UIM stacking calculator.

This is general information, not legal advice, and the state comparisons above are illustrative, not an exhaustive survey. Confirm how North Carolina's rules apply to your specific case with a licensed North Carolina attorney.