Uninsured Motorist Coverage Costs: Compare Options
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Last updated on November 24, 2025
Comparing Costs of Uninsured vs Underinsured Motorist Coverage for Your Needs
Author
Jane Taylor
— Licensed auto and home insurance agent
Understanding the costs associated with uninsured motorist (UM) coverage and underinsured motorist (UIM) coverage is crucial if you want to protect yourself financially on the road. The choice between uninsured and underinsured motorist coverage — and how much of each you buy — can significantly affect what you pay out of pocket after a serious accident.
This guide explains how UM and UIM coverage work, what they typically cost, and how to decide on limits that fit your budget and risk tolerance. By the end, you’ll have a clearer picture of how to compare uninsured vs underinsured motorist coverage and choose the right balance of protection for your situation.
Understanding Insurance Coverage Types
Uninsured and underinsured motorist coverage are designed to protect you when the other driver’s insurance is not enough — or doesn’t exist at all. In many states, medical bills, lost wages, and pain and suffering can quickly exceed the at-fault driver’s bodily injury limits, which is why UM and UIM coverage are so important.
Uninsured motorist (UM) coverage usually applies when:
- The at-fault driver has no auto insurance at all.
- You’re the victim of a hit-and-run and the driver cannot be identified.
- A pedestrian or cyclist is hit by an uninsured driver, depending on state rules.
Underinsured motorist (UIM) coverage typically applies when:
- The at-fault driver has insurance, but their liability limits are too low to cover your total damages.
- Your medical bills, lost wages, and other covered losses exceed the other driver’s bodily injury limits.
- Your own UIM limits are higher than the at-fault driver’s limits, and your policy “fills the gap” up to those limits.
When evaluating these options, consider factors such as your vehicle’s value, your driving record, and the amount of potential liability you want to protect yourself from. By analyzing these elements, you can tailor your policy so that your assets and future income are better protected against financial loss.
The Financial Implications of Coverage
The costs associated with UM and UIM coverage can vary significantly from driver to driver. Insurers price these coverages based on many of the same factors that affect your liability and collision premiums. Common pricing factors include:
- Your state and local requirements — Some states require UM/UIM coverage, while others make it optional.
- Your driving record — A clean record with no recent at-fault accidents or serious violations can help keep premiums lower.
- Your vehicle — Premiums may be higher for newer or more expensive vehicles, particularly when medical and lost wage costs are likely to be higher.
- Your chosen coverage limits — Higher bodily injury and property damage limits typically lead to higher premiums, but also more protection.
- Your claims history — Multiple prior claims or high-dollar losses can increase your risk profile.
Understanding how these factors work together makes it easier to budget for UM and UIM coverage. If you are unsure where to start, speaking with a licensed agent can help you interpret quotes and policy language so you’re not just choosing the cheapest option, but the one that offers the best value for your needs.
Estimating Premium Costs
While exact premiums depend on your state, insurer, and risk profile, many drivers pay roughly $10 to $30 per month for uninsured motorist coverage when added to a standard auto policy. Underinsured motorist coverage is often priced similarly, and in some cases may be slightly less or bundled with UM coverage as a package.
The table below gives a simplified example of how UM and UIM costs might compare for a typical driver. Your own quotes may be higher or lower based on your unique circumstances and state requirements.
| Coverage Type | Example Limits (per person/per accident) | Typical Added Monthly Cost* | Example Scenario |
|---|---|---|---|
| Uninsured Motorist (UM) | $50,000 / $100,000 | $10–$20 | You’re hit by a driver with no insurance and need coverage for medical bills and lost wages. |
| Underinsured Motorist (UIM) | $50,000 / $100,000 | $8–$18 | The at-fault driver carries only state minimum limits that do not fully cover your costs. |
| UM + UIM Package | $100,000 / $300,000 | $20–$30 | You want higher limits to protect a family with multiple drivers and a higher household income. |
*These ranges are simplified examples for illustration only. Actual rates vary by insurer, state, driving record, and coverage selections.
When the financial stakes are high, it becomes essential to compare multiple quotes carefully. Resources such as NerdWallet’s guide to uninsured motorist coverage[1] can help you understand what affects pricing and how coverage works in different states.
Delving into Coverage Needs
The “right” amount of uninsured and underinsured motorist coverage is different for every driver. To decide how much protection you need, think about:
- Your risk tolerance: How comfortable are you with the possibility of paying some medical bills or lost wages out of pocket?
- Your assets and income: Home equity, savings, and future earnings are all worth protecting, especially if a serious injury keeps you from working.
- Your vehicle value: While UM/UIM primarily protect people, some policies include property damage coverage that can help with repairs.
- Local laws and accident patterns: Some areas have higher rates of uninsured drivers, which may justify higher limits.
As a general rule, many experts recommend choosing UM/UIM limits that match your bodily injury liability limits when possible. This helps ensure you are protecting yourself and your passengers to the same degree that you protect other drivers.
Evaluating Your Financial Position
Before adjusting your policy, take a few minutes to review your overall financial health. This doesn’t need to be complicated. Start by listing:
- Your current savings and emergency fund.
- Any major debts such as a mortgage, car loan, or student loans.
- The approximate value of your vehicle and other significant assets.
- How long you could cover living expenses if you were unable to work for a period of time.
If you have significant assets or dependents who rely on your income, stronger UM/UIM limits may make sense. If your financial situation is more modest, you might still choose higher limits for peace of mind, but you’ll want to balance that with what you can comfortably afford each month.
Comparing Policy Options
Shopping around is one of the most effective ways to keep UM and UIM premiums reasonable. Different insurers use different pricing models, so quotes for the same coverage level can vary widely. When you compare, try to:
- Request quotes with the same UM/UIM limits from each company so you can compare apples to apples.
- Review how each policy defines UM and UIM, including any exclusions or offsets.
- Ask about available discounts, such as safe driver, multi-car, or bundling auto and home insurance.
- Check how claims are handled and whether the insurer has a reputation for good customer service.
Online comparison tools and insurer websites like Direct Auto[2] can help you collect quotes quickly, but it’s still smart to review the details with an agent or representative before you make a final decision.
The Impact of Claims on Costs
Claims history is another important piece of the pricing puzzle. In general, insurers may charge higher premiums if you file multiple claims, even if they are relatively small. That’s because frequent claims can indicate a higher likelihood of future losses.
To manage your long-term costs:
- Consider choosing a deductible that you could realistically afford to pay out of pocket.
- Think twice before filing very small claims that fall only slightly above your deductible.
- Ask your insurer how specific types of claims might affect your renewal premium.
None of this means you should avoid using your coverage when you truly need it. UM and UIM coverage exist to protect you from major financial harm after serious accidents. The key is to be thoughtful about when to involve your insurer and when it might make sense to handle minor damage yourself.
How State Laws Affect Coverage
State laws play a major role in how UM and UIM coverage work, and in some places, whether they are mandatory. For example, some states require drivers to buy UM coverage up to a certain limit, while others simply require insurers to offer it and allow you to reject it in writing.
Because the rules vary so much, it’s important to:
- Verify your state’s minimum auto insurance requirements, including any UM/UIM rules.
- Ask your insurer whether your policy includes stacked or non-stacked UM/UIM coverage if you insure multiple vehicles.
- Review any forms you signed when you bought your policy to see whether you rejected higher UM/UIM limits in the past.
Staying informed about your state’s specific regulations will help you avoid legal penalties and reduce the risk of discovering a coverage gap after a crash.
Making Informed Insurance Decisions
Once you understand how UM and UIM coverage work, you can make more confident decisions about your policy. A helpful approach is to:
- Confirm your current UM/UIM limits and how they compare to your bodily injury liability limits.
- Review your finances and risk tolerance to decide whether those limits are still appropriate.
- Collect several quotes if you plan to increase your limits or change insurers.
- Ask a licensed agent to walk you through scenarios based on real-life accidents and claim examples.
An experienced insurance professional can help you spot common pitfalls — like rejecting UM/UIM coverage to save a small amount of money each month, only to face large out-of-pocket costs after an accident with an uninsured driver.
Customer Experiences
Personal Experiences with Loya Insurance
Real customer stories can make it easier to picture how coverage decisions play out in everyday life. Here’s how drivers in Las Vegas describe their experience reviewing and customizing their policies:
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“Loya helped me understand my coverage needs and provided excellent options for uninsured and underinsured motorist protection.”
“The staff was very knowledgeable and made picking the right UM and UIM limits easy. I feel much safer driving now.”
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FAQ
What is the difference between uninsured and underinsured motorist coverage?
Uninsured motorist coverage protects you if you are in an accident with a driver who has no insurance or in certain hit-and-run situations. Underinsured motorist coverage applies when the at-fault driver has some insurance, but their liability limits are too low to cover your total damages. Both coverages are designed to help with expenses such as medical bills, lost wages, and other covered losses.
How much does uninsured motorist coverage cost?
Many drivers pay around $10 to $30 per month for uninsured motorist coverage, but your cost may be higher or lower. Factors such as your state, driving history, vehicle type, and chosen limits all influence pricing. Comparing multiple quotes and asking about discounts is the best way to find a competitive rate for your situation.
Can my rates increase if I make a claim?
Yes, filing claims — including UM or UIM claims — can sometimes lead to higher premiums at renewal, especially if you have multiple claims in a short period. Insurers often view a history of frequent claims as a sign of higher risk. Ask your insurer how a specific claim might affect your rates before filing if the loss is relatively minor.
Are there any discounts available for uninsured motorist coverage?
Discounts are usually applied to your overall auto policy rather than UM or UIM coverage specifically, but they still help reduce your total premium. Common discounts include safe driver, good student, multi-car, and bundling auto with home or renters insurance. It’s always worth asking which discounts you may qualify for when you’re reviewing quotes.
What factors can affect my uninsured motorist coverage costs?
Key factors include your location, driving history, age, vehicle type, coverage limits, and prior claims. Living in an area with a higher percentage of uninsured drivers may also influence how insurers price UM/UIM coverage. Understanding these variables can help you make informed trade-offs between cost and protection.
Conclusion
In summary, understanding the cost and protection differences between uninsured and underinsured motorist coverage is essential for building a strong auto insurance plan. By reviewing your finances, risk tolerance, and state requirements, you can select limits that help safeguard your health, income, and assets if you’re hit by a driver who doesn’t carry enough insurance.
Take time to compare multiple quotes, ask detailed questions about how UM and UIM coverage work, and consult with a knowledgeable insurance agent if you need guidance. A few extra minutes now can prevent major financial stress after a serious accident.
This article is for general educational purposes and does not replace personalized advice from a licensed insurance professional. Policy options, pricing, and requirements vary by state and insurer.
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