What is uninsured motorist coverage?

Uninsured motorist (UM) coverage pays for your injuries and, in some states, vehicle damage when you're hit by a driver with no insurance — or by a hit-and-run driver who flees. Underinsured motorist (UIM) coverage kicks in when the at-fault driver's liability limits aren't high enough to cover your losses.

About 1 in 8 drivers on U.S. roads is uninsured, according to the III. Even in states where auto liability insurance is required, non-compliance is common. If an uninsured driver hits you, their liability policy doesn't exist to pay your medical bills or repair your car — uninsured motorist coverage fills that gap.

Uninsured motorist (UM) vs. underinsured motorist (UIM)

UM — Uninsured Motorist: Pays when the at-fault driver has no liability insurance at all, or in a hit-and-run where the driver can't be identified.
UIM — Underinsured Motorist: Pays when the at-fault driver has liability insurance, but their limits aren't enough to cover your damages. UIM covers the gap above their policy up to your UIM limit.
Both UM and UIM can cover bodily injury (medical bills, lost wages, pain and suffering). In some states they also include a property damage component (UMPD/UIMPD).

Is it required?

Roughly half of U.S. states require uninsured motorist coverage (or require that it be offered and that the insured sign a written waiver to reject it). Even where it's optional, the NAIC and most state departments of insurance recommend it, given the prevalence of uninsured drivers and the medical costs involved in a serious accident. Check your state's insurance department for the specific requirement.

How much do you need?

UM/UIM limits are typically set to match your liability limits. If you carry 100/300 bodily injury liability, setting UM/UIM at the same 100/300 is the standard recommendation — it mirrors the protection you're giving others on the road. The premium for UM/UIM is relatively modest compared to the risk it mitigates.

Key facts on uninsured drivers

In 2022, an estimated 14.0% of motorists — about 1 in 7 — were uninsured, according to a study commissioned by the III. — III — Uninsured Motorists
About half of U.S. states require uninsured motorist coverage; the rest require it to be offered, with a written rejection option. — NAIC
Underinsured motorist coverage pays when the at-fault driver's liability limits are insufficient to cover your actual damages — it covers the gap up to your own UIM limit. — III

Key takeaways

1 in 7 drivers is uninsured — UM/UIM coverage is protection against their negligence, not your own.
UM pays when the other driver has no insurance. UIM pays when their limits aren't enough.
About half of states require UM coverage; everywhere else it's strongly recommended.
Set UM/UIM limits to match your liability limits for symmetrical protection.
Hit-and-run incidents are typically covered under UM, since the at-fault driver can't be identified.

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