What is Uninsured Motorist Coverage (UM)

Uninsured motorist (UM) coverage is a provision on an auto insurance policy which provides coverage when a driver without insurance is found at-fault for an accident. It is an add-on to a standard auto policy that pays for injuries to the policyholder and passengers, and in some instances for damage to property if the other driver is legally responsible for the accident. Not all states will require insurance policies to include uninsured motorist coverage.

Uninsured coverage is not the same as underinsured coverage, which includes when the at-fault driver does not have enough insurance to satisfy your damages claims fully.

BREAKING DOWN Uninsured Motorist Coverage (UM)

An uninsured motorist (UM) is an at-fault driver who has no auto insurance, does not have insurance that meets state-required minimum liability amounts, or whose insurance company is unwilling or unable to pay the claim. A hit-and-run driver would also be considered an uninsured motorist. Without this coverage, a person holding a regular automobile insurance policy may not receive payments if they are involved in an accident where the other party is at fault and uninsured.

Uninsured motorist coverage usually adds only a small amount to an auto insurance policy cost but provides beneficial coverage. This coverage will become useful during an accident where the driver who was found to be at-fault does not auto insurance which would cover the cost of damages from the crash. 

According to the Insurance Research Council, during 2015. One in every eight U. S. drivers on the road did not have insurance. The study found that Florida had the highest number of uninsured drivers at 26.7%, followed by Mississippi, New Mexico, Michigan, and Tennessee. The state with the lowest number of uninsured motorists is Maine having 4.5-percent.

State laws generally mandate that motorists carry some level of automobile liability insurance coverage, and these requirements vary from state to state. New Hampshire is the only U.S. state that does not require a minimum amount of auto insurance coverage. Twenty-two states require that policies also include uninsured motorist (UM) coverage.

Insurance companies will employ underwriters who will use risk analysis to determine the amount of premium due on a policy. These premiums also vary depending on the age, gender, years of driving experience, number of accidents or moving violation ticket history, and other factors. The term of insurance is usually for six or 12 months and is renewable.

Filing an Uninsured Motorist Coverage Claim

When a person has an accident which is not their fault, and the other motorist does not have insurance to cover the damages the uninsured provision of a policy becomes effective. During the investigation of an accident, if the at-fault driver does not have insurance, the police will inform the other involved drivers. If the police do not react to the accident, or in the case of a hit-and-run crash, try to gather as much information as possible. Ask for names, addresses, and phone numbers, of potential witnesses, and, if possible, get the license plate number. Also, take photographs of the accident scene. 

As soon as possible file a claim with your insurance company, providing all the information you may have. Once you file a claim with your provider, their adjuster will investigate the case and will need any information gathered at that time. After an investigation, the company may allow the claim to the maximum of your policy's coverage. However, they may deny the claim if there is not enough evidence that the accident was not due to your negligence.

Some insurance providers will have a limit on how long you can wait before you file your uninsured claim. These limits will vary by company. As the insurance company settles your claim, they will want copies and billings from all medical care received and any automobile repair that resulted from the event. If the insurance provider decides the costs submitted with the claim was unnecessary or not related to the accident, they will deny those amounts. If the policyholder disagrees with the decision of the insurance provider, the case will usually go to binding arbitration.

General Auto Insurance Coverage

An auto insurance policy covers the policyholder and other family named members, whether driving the insured car or someone else’s car with their permission. The insurance also provides coverage to someone who is not named but is operating the vehicle with the policyholder’s consent.

Personal auto insurance is limited to personal driving and does not cover using the car for commercial purposes, such as making deliveries. It also does not include driving the insured vehicle during ride-sharing services such as Uber or Lyft. Some auto insurers offer supplemental insurance products at an additional cost which extend coverage for vehicle owners that provide ride-sharing services.

Most states require car owners to carry bodily injury and property damage liability coverage as a minimum. Policies may also include increased medical, property, and personal injury protection (PIP) coverage. Some states will require the policy include coverage for uninsured motorist coverage.

  • Bodily injury liability covers costs associated with injuries or death that the policyholder or another driver causes while driving the insured car.
  • Property damage liability reimburses others for damage caused by the insured’s car to another vehicle or other property.
  • PIP reimburses medical expenses for injuries to the insured or their passengers and will cover lost wages and related expenses.
  • Uninsured motorist coverage reimburses the policyholder when an accident is from a driver who does not have auto insurance.