Uninsured motorist coverage protects you when the at-fault driver has no insurance. Given that the Insurance Research Council estimates approximately 12.6% of drivers are uninsured, UM coverage provides essential protection against drivers who cannot pay for the injuries they cause.
The Uninsured Driver Problem
Uninsured drivers are common:
National Rate
Approximately 12.6% of drivers nationwide lack insurance.
State Variation
Rates range from under 5% in some states to over 25% in others.
Collision Risk
With millions of uninsured drivers, collision with one is statistically likely over a driving lifetime.
How UM Coverage Works
Uninsured motorist coverage:
First-Party Coverage
You recover from your own insurer, not the at-fault driver’s insurer.
Liability Substitute
Provides what the at-fault driver’s liability insurance would have provided.
Your Own Policy
UM coverage appears on your auto policy, not the other driver’s.
When UM Coverage Applies
UM coverage applies in specific situations:
Uninsured At-Fault Driver
The other driver caused the accident and has no liability insurance.
Hit-and-Run
The at-fault driver fled and cannot be identified. Most UM policies cover these situations.
Unidentified Vehicle
When a vehicle causes an accident without contact and cannot be identified.
Stolen Vehicle
When the at-fault vehicle was stolen and the owner’s policy does not cover the thief’s conduct.
UM Coverage Requirements
Mandatory Waiver
Most states require insurers to offer UM coverage. Policyholders must sign written waivers to decline.
Minimum Limits
When required, UM coverage minimums typically match liability minimums.
Optional Higher Limits
Policyholders can usually purchase UM limits up to their liability limits.
Who Is Covered
UM coverage typically protects:
The Named Insured
The policyholder.
Resident Family Members
Family members living in the household.
Vehicle Occupants
Passengers in the insured vehicle.
Pedestrians
The insured and family members if struck as pedestrians.
Proving Fault and Damages
UM claims require proving:
The Other Driver’s Liability
You must prove the uninsured driver was at fault, just as you would in a liability claim.
Your Damages
Medical expenses, lost wages, and pain and suffering must be documented.
Causation
Injuries must have been caused by the accident.
Hit-and-Run Claims
UM coverage for unidentified drivers has special requirements:
Reporting Requirements
Prompt police reports are typically required.
Contact Requirements
Some policies require physical contact between vehicles. Others do not.
Evidence Requirements
Independent evidence of the hit-and-run may be required.
The Arbitration Process
UM disputes often go to arbitration:
Contractual Arbitration
Many policies require arbitration rather than litigation.
Binding Decisions
Arbitration results are typically binding.
Faster Resolution
Arbitration often resolves faster than court litigation.
Limited Appeals
Arbitration decisions have limited appeal rights.
Stacking UM Coverage
Multiple UM coverages may apply:
Multiple Vehicles
Policies covering multiple vehicles may allow stacking of limits.
Multiple Policies
Different policies on different vehicles may stack.
Anti-Stacking Provisions
Some policies and state laws limit stacking.
Jurisdictional Variation
Stacking rules vary significantly by state.
Coordination with Other Coverage
UM coverage interacts with other benefits:
Health Insurance
May pay medical expenses regardless of fault, with UM claim addressing remaining damages.
MedPay/PIP
First-party medical coverage may apply alongside UM claims.
Subrogation
Health insurers may have subrogation rights against UM recoveries.
Insurer Defenses
Insurers may contest UM claims:
Liability Disputes
Arguing the uninsured driver was not at fault or shared fault.
Causation Challenges
Disputing that injuries resulted from the accident.
Coverage Defenses
Policy exclusions or conditions that may bar coverage.
Damage Disputes
Contesting the value of claimed damages.
Bad Faith in UM Claims
First-party bad faith applies:
Different Relationship
Unlike third-party claims, UM claims involve your own insurer.
Good Faith Duties
Insurers owe good faith claim handling to their own policyholders.
Bad Faith Remedies
Unreasonable claim denial may support bad faith claims.
Practical Guidance
Purchase adequate UM coverage to protect against uninsured drivers.
Report hit-and-run accidents immediately.
Document the accident thoroughly regardless of whether the other driver is insured.
Understand that UM claims are against your own insurer.
Know whether arbitration or litigation applies to disputes.
Consider whether stacking applies to increase available limits.
UM coverage provides essential protection in a world where millions of drivers lack insurance. Maintaining adequate UM limits is one of the most important insurance decisions drivers make.
Sources:
- Uninsured driver rate (12.6%): Insurance Research Council
- UM coverage requirements: State insurance codes (varies by jurisdiction)
- Written waiver requirements: State insurance regulations