UM/UIM coverage is a type of auto insurance that pays your expenses when the driver who hit you has no insurance (UM) or not enough insurance (UIM) to cover your injuries and vehicle damage. It protects you financially in situations where the at-fault driver can’t pay what they owe you. Roughly 20 states plus Washington, D.C. require some form of UM or UIM coverage, but even where it’s optional, it fills a gap that other parts of your policy don’t.
How Uninsured Motorist Coverage Works
Uninsured motorist coverage, or UM, kicks in when you’re hit by a driver who carries no auto insurance at all. It also typically covers hit-and-run accidents, where the other driver leaves the scene and you have no way to file a claim against their insurer. In either case, there’s simply no other insurance company to bill for your medical costs or car repairs.
When you file a UM claim, your own insurer steps in and pays your covered expenses up to the limits on your policy. You’re essentially using your own coverage to replace the liability insurance the other driver should have carried. Without UM coverage, you’d be stuck paying out of pocket or trying to sue the uninsured driver directly, which rarely results in meaningful recovery.
How Underinsured Motorist Coverage Works
Underinsured motorist coverage, or UIM, applies when the at-fault driver does have insurance but their policy limits aren’t high enough to cover your bills. Say someone causes an accident that leaves you with $80,000 in medical expenses, but their liability policy only covers $50,000. Their insurer pays their maximum, and then your UIM coverage can help pay the remaining $30,000, up to your own policy limit.
This scenario is more common than many drivers realize. A large share of motorists carry only their state’s minimum required liability limits, which can be as low as $25,000 per person for bodily injury. A single emergency room visit, surgery, or extended rehab program can easily exceed that amount.
Bodily Injury vs. Property Damage
UM/UIM coverage is split into two components, and understanding the difference matters because your state may require one but not the other, or you may be able to choose your limits independently for each.
- Uninsured/underinsured motorist bodily injury (UMBI): Covers medical expenses, lost income, funeral costs, and pain and suffering for you and your passengers. This is the core of UM/UIM coverage and the part most states mandate when they require it.
- Uninsured/underinsured motorist property damage (UMPD): Covers repairs to your vehicle, up to its actual cash value. Some states include a deductible for this portion. If you already carry collision coverage on your policy, UMPD may overlap with it, though filing under UMPD can sometimes avoid the collision deductible.
When UM/UIM Coverage Is Required
About 20 states and Washington, D.C. require drivers to carry UM coverage, UIM coverage, or both as part of their auto insurance policy. In states that mandate it, the coverage is built into your policy and you typically can’t remove it without signing a written rejection form. In states where it’s optional, insurers are generally required to offer it to you, and you’ll need to actively decline it if you don’t want it.
Even in states where UM/UIM isn’t mandatory, it’s worth considering. The Insurance Research Council has estimated that about one in eight drivers on U.S. roads is uninsured. That number is higher in some states. If one of those drivers hits you, your UM coverage is the difference between being covered and absorbing the full cost yourself.
How Policy Limits Work
UM/UIM limits are structured the same way as liability limits. You’ll see them expressed as split limits, like $50,000 per person and $100,000 per accident, or as a single combined limit. The per-person limit is the most your insurer will pay for one individual’s injuries, and the per-accident limit caps the total payout when multiple people are hurt.
Your UM/UIM limits don’t have to match your liability limits, but many insurance professionals recommend keeping them at least equal. The logic is straightforward: if you’ve decided you need $100,000 in liability coverage to protect others, you probably want the same level of protection for yourself.
Stacking Your Coverage Limits
If you insure more than one vehicle on your policy, some states allow you to “stack” your UM/UIM coverage. Stacking means multiplying your per-accident limit by the number of insured vehicles to create a higher total limit.
For example, if you carry $25,000 in uninsured motorist bodily injury coverage and insure three cars on one policy, stacking would give you up to $75,000 in available coverage after a single accident. This is called vertical stacking because it happens within one policy. Some states also permit horizontal stacking, which lets you combine UM/UIM limits from separate policies within the same household.
A few important details about stacking: it only applies to the bodily injury portion of your coverage, not property damage. Not every state permits it, and even in states that do, not every insurer offers it. Stacked policies cost more than unstacked ones because you’re getting a higher effective limit. When you’re shopping for coverage, your insurer should present both options where stacking is available.
What UM/UIM Coverage Doesn’t Cover
UM/UIM only applies when someone else causes the accident. If you’re at fault, this coverage won’t pay for your own injuries or damage. It also won’t cover you if you’re in a single-vehicle crash with no other driver involved.
Property damage coverage under UM/UIM has a ceiling at your vehicle’s actual cash value, meaning the market value of your car at the time of the accident, not what you paid for it or what it would cost to buy a new one. And if your state’s UM/UIM requirement only covers bodily injury, you’d need collision coverage separately to handle vehicle repairs after an accident with an uninsured driver.
How Much It Costs
UM/UIM coverage is one of the less expensive additions to an auto insurance policy. The exact cost depends on your state, your chosen limits, whether you elect stacking, and your overall risk profile. But because it only triggers under specific circumstances (an accident caused by an uninsured or underinsured driver), premiums tend to be modest relative to the protection you get. In many cases, adding UM/UIM coverage or increasing your limits adds only a small percentage to your total premium. You can get exact pricing by requesting quotes at different limit levels from your insurer.