Uninsured motorist and underinsured motorist coverage exist for a simple reason: not every driver on the road has enough insurance to pay for the harm they cause. If you are hit by a driver with no liability insurance, or a driver whose limits are too low, UM/UIM may help cover injuries, lost wages, and certain related losses depending on your state and policy language.
The Insurance Information Institute explains that uninsured motorist coverage can help pay medical bills and lost wages when an at-fault uninsured driver causes an accident, and it may also apply to hit-and-run situations in many cases [1]. NAIC also notes that UM/UIM may be required in some states and optional in others, so your state rules and declarations page matter [2].
If you want the basic difference first, review uninsured vs underinsured motorist coverage. If your main question is price, compare this guide with uninsured motorist coverage costs and compare uninsured motorist coverage.
UM Coverage
Helps when the at-fault driver has no insurance or cannot be identified in a covered hit-and-run situation.
UIM Coverage
Helps when the at-fault driver has insurance, but their liability limits are too low to cover your covered losses.
Limits Matter
Low limits may be better than none, but serious injuries can exceed minimum limits quickly.
How UM/UIM Works in Real Life
Here is a simple example. Imagine you are injured in a crash and your medical bills, lost wages, and other covered losses add up to $90,000. The at-fault driver has insurance, but only $25,000 in bodily injury liability coverage. Their insurer pays up to that limit, then stops. The remaining gap may be where your UIM coverage can help, subject to your policy terms and limits.
| Example Number | What It Means | Why UIM Matters |
|---|---|---|
| Your injury-related losses: $90,000 | Medical care, lost wages, and other covered damages. | This is the total financial impact in the example. |
| At-fault driver’s limit: $25,000 | Their insurer may pay up to the policy limit. | The at-fault driver’s insurance may not be enough. |
| Potential gap: $65,000 | The remaining loss after the at-fault driver’s limit. | Your UIM may help, up to your own limits and policy terms. |
If you do not carry UIM, or if your UIM limits are too low, you may be left trying to handle the gap through savings, health insurance, or direct recovery from the at-fault driver. That is why limit selection matters.
Step 1: Evaluate Your Driving Exposure
Your exposure to UM/UIM risk depends on how often you drive, where you drive, and how much financial risk you would face after a serious accident. The more time you spend on the road, the more valuable stronger UM/UIM limits may become.
Higher Exposure Drivers
- Daily commuters.
- Long-distance highway drivers.
- Drivers in dense urban traffic.
- Households with multiple drivers or vehicles.
- Drivers who depend on their vehicle for work.
Financial Risk Questions
- Could you cover medical bills if another driver has low limits?
- Could you miss work for weeks without financial damage?
- Do you have savings or income to protect?
- Do you support dependents?
- Would a serious crash affect your household budget long term?
Step 2: Understand State Requirements and Options
UM/UIM rules vary by state. Some states require it, some require insurers to offer it, and others allow drivers to reject it in writing. NAIC explains that in some states uninsured and underinsured motorist coverage is required, and uninsured motorist coverage can reimburse you if an uninsured or hit-and-run driver hits you [2].
NAIC’s uninsured motorists topic page also notes that uninsured motorist rates vary widely by state, and that 15.4% of motorists were uninsured in 2023 according to Insurance Research Council data cited by NAIC [3]. That makes this coverage more than a technical policy option; it can be real protection against a common road risk.
| Question | Why It Matters | Where to Check |
|---|---|---|
| Is UM/UIM required in my state? | Requirements vary and may affect your available choices. | Your state insurance department or licensed agent. |
| Does UM apply to hit-and-run? | Some policies require a police report or specific documentation. | Your policy documents and claims department. |
| Is stacking allowed? | Stacking can increase available limits across vehicles or policies. | Your state law and policy language. |
| Does UMPD exist in my state? | Uninsured motorist property damage rules vary by state. | Your declarations page and state rules. |
What Is Stacking?
Stacking generally means combining UM/UIM limits across multiple vehicles or policies to increase the total available coverage after a covered loss. Whether stacking is allowed, restricted, or unavailable depends on your state and policy language.
If Stacking Is Allowed
Your available UM/UIM limit may be higher than the limit shown for one vehicle, depending on how your policy is written.
If Stacking Is Not Allowed
You may only have access to the limit shown for the covered vehicle or policy involved in the claim.
Ask Before You Buy
If you insure multiple vehicles, ask your agent whether stacking applies and how it changes your protection.
Step 3: Choose Limits Based on Real Risk
A practical way to choose UM/UIM limits is to ask what would happen if another driver caused a serious crash and had no insurance or only minimum coverage. If the answer is that your savings, income, or household stability would be at risk, higher UM/UIM limits may be worth comparing.
| UM/UIM Limit | May Fit | Practical Note |
|---|---|---|
| $25,000 / $50,000 | Tight budgets or states with lower minimum requirements. | Better than no UM/UIM, but serious injuries can exceed this quickly. |
| $50,000 / $100,000 | Drivers who want more than the lowest protection. | Often a more realistic starting point for moderate injury exposure. |
| $100,000 / $300,000 | Frequent drivers, larger households, or drivers with income and savings to protect. | Commonly compared by households wanting stronger protection. |
| Higher limits or umbrella-related options | Higher-income households or drivers with significant assets. | Ask how UM/UIM coordinates with umbrella or excess liability coverage. |
Many drivers compare UM/UIM limits against their bodily injury liability limits. Matching those limits can create more consistent protection, but the right choice depends on your budget, state rules, and personal risk tolerance.
Step 4: Compare Quotes the Right Way
UM/UIM can look inexpensive or expensive depending on the state, limits, claim trends, and insurer. The only fair way to compare is to request quotes using the same UM/UIM limits, liability limits, deductibles, vehicles, and driver information.
For related pricing help, see uninsured vs underinsured coverage costs, cost of uninsured motorist coverage, and get an uninsured motorist coverage quote.
Compare These Items
- UM bodily injury limits.
- UIM bodily injury limits.
- UM property damage, if available.
- Hit-and-run rules.
- Stacking rules.
Avoid These Mistakes
- Assuming “full coverage” always includes UM/UIM.
- Choosing minimum limits without checking injury risk.
- Ignoring state-specific rules.
- Not reviewing limits after moving or changing vehicles.
- Comparing quotes with different limits.
Questions to Ask Before Choosing UM/UIM Limits
The fastest way to understand your real protection is to ask targeted questions while reviewing your declarations page. Do not rely only on the phrase “full coverage,” because that term is not standardized.
- Do I have UM, UIM, or both?
- Are my limits per person / per accident, or structured differently?
- Does the coverage include hit-and-run claims?
- Does my policy include uninsured motorist property damage?
- Can I stack limits across vehicles?
- How much more would it cost to raise UM/UIM to match my liability limits?
What Happens If You Need to File a Claim?
If you already have coverage and need claims help, use your insurer’s official claims process. Fred Loya’s claims page says customers can report a claim to Loya Insurance Group at 1-800-880-0472 and lists claims office hours [4]. Claims rules and documentation requirements can vary, especially for hit-and-run or UM/UIM claims.
For related claim topics, review uninsured motorist coverage claim basics, what to do after an accident with an uninsured driver, and Loya insurance claims.
Final Recommendation
UM and UIM coverage protect you from a problem you cannot fully control: another driver’s lack of insurance or inadequate limits. If your budget allows, comparing higher UM/UIM limits can be a smart move, especially if you drive often, commute on busy roads, have income to protect, or live in a state with a higher share of uninsured drivers.
Start by checking your current declarations page, compare your limits to your liability coverage, ask whether stacking applies, and price several limit options. A small premium increase may provide a much larger financial cushion after a serious accident.