Uninsured / underinsured motorist coverage (UMC/UIM) is insurance coverage that is included in your auto insurance policy in California unless you waive it in writing. UMC/UIM coverage pays when another driver:
- is at fault but either has no insurance at all, or
- does not carry enough insurance to cover your medical bills and other losses, or
- flees the scene in a “hit and run” and cannot be found.
California law requires you to maintain a minimum of “15/30/5” liability insurance that pays up to:
- $15,000 for bodily injury coverage or death per person,
- $30,000 for total bodily injury or death per accident (to all people in the other vehicle combined), and
- $5,000 for property damage (collision coverage) to the other vehicle.
However, 15/30/5 is often too little to pay for damages after a car accident, and one in six motorists carry no insurance at all.1
If you are injured by an uninsured or underinsured driver, having UMC/UIM coverage allows you to still collect damages for medical costs, lost wages, car repair bills, pain and suffering and other losses.
To help you better understand uninsured / underinsured auto insurance, our California personal injury lawyers discuss the following, below:
- 1. Uninsured motorist coverage
- 2. Underinsured motorist coverage
- 3. What if I have health insurance?
- 4. How much UMC/UIM do I need?
- 5. Examples of how it works
- 6. The claims process
- Additional resources
1. Uninsured motorist coverage
Uninsured motorist coverage (UMC) covers your compensatory damages (up to your UMC policy limit) if you are:
- hit by an uninsured driver or
- hit by a driver who flees the scene after causing some physical contact with your car (“hit and run”) and is never found.
UMC is comprised of:
- uninsured motorist bodily injury (UMBI) and
- uninsured motorist property damage (UMPD).
This way, you get paid even if the at-fault party cannot pay you.
UMC coverage is a mandatory part of your car insurance policy in California unless you sign a written waiver. Therefore, it is presumed that you have UMC/UIM coverage unless you waive it.2
UMC helps solve the problem of drivers who are unable or unwilling to pay for their own insurance. It also takes the burden off private health insurers and government programs like Medicare and Medi-Cal to pay for your car accident injuries.
2. Underinsured motorist coverage
Underinsured motorist insurance (UIM) kicks in if your damages after a car accident are more than what the at-fault driver’s policy covers. UIM pays you the difference between your total damages and the at-fault driver’s policy limit (up to your policy limit, of course).
Note that your UIM payment gets reduced if you have other insurance sources that can cover your losses, such as:
- Your workers’ compensation insurance if you were on-duty;
- The at-fault driver’s employer’s insurance (if they are liable under respondeat superior);
- The vehicle manufacturer’s insurance (if they are liable under product liability);
- Med-Pay (Medical Payments Coverage), which is optional insurance you are advised to carry
Like UMC coverage, UIM coverage is a mandatory part of your car insurance policy in California unless you sign a written waiver. It is highly recommended since the minimum automobile insurance required in California is often too low to cover damages for all but minor fender benders.
(See our article on the difference between uninsured and underinsured motorist coverage.)
3. What if I have health insurance?
It is still recommended you carry UMC/UIM insurance even if you have a good health insurance plan.
UMC/UIM is first-party insurance that allows you to recover from your own insurance company for all your compensatory damages after an accident that is not your fault (up to your policy limit). This includes services regular health insurance plans do not cover, such as chiropractic care and acupuncture.
UMC/UIM coverage also can go towards your
- property damage to your car,
- lost work time, and
- pain and suffering.
Plus UMC/UIM does this without the high deductibles and health insurance co-pays.
Another perk of UMC/UIM is that it can cover you and any family members living in your household. You all should be covered whenever any of you are:
- a driver or occupant of a car or motorcycle, or
- riding or bicycle,
- pedestrian, or3
- even on a horse or on stilts!
UMC/UIM can cover your friends and non-household family members only if the collision occurs while they were:
- a driver of your car with permission
- a passenger in your car
- exiting the car your car
- entering your car
17% of California motorists are uninsured according to Insurance Information Institute.
4. How much UMC/UIM do I need?
The default UMC/UIM California insurers offer is typically:
- $30,000 for bodily injury coverage or death per person, and
- $60,000 for total bodily injury or death per accident (to all people in the other vehicle combined), and
- $3,500 for property damage
However if you agree in writing, you have the option of buying the minimum UMC/UIM policy allowed under state law. This is:
- $15,000 for bodily injury coverage or death per person, and
- $30,000 for total bodily injury or death per accident (to all people in the other vehicle combined), and
- $3,500 for property damage.4
Note that in California, UMC/UIM applies only if the other driver’s insurance coverage is lower than your UMC/UIM coverage:
Example: If the at-fault driver has a $30,000 liability policy and you have a $30,000 UMC/UIM policy, you would not be eligible to use your UMC/UIM policy. Though if your UMC/UIM policy was for $60,000, then you could claim up to $30,000 from that policy ($60,000 minus $30,000).
If you can afford it, it is recommended you buy as much UMC/UIM as possible. A $300,000-$500,000 policy is recommended.
5. Examples of how it works
In each of these examples assume that Joe runs a red light and flips a car driven by Katie onto its side in Los Angeles. Katie is knocked unconscious. Along with a head injury, she has a broken arm.
Katie’s medical bills total $50,000 and she misses six weeks of work for which she would have earned an additional $15,000. The cost to repair her vehicle is another $10,000. Therefore, Katie’s total damages — not including pain and suffering — are $75,000.
- Example 1: Neither Joe nor Katie is insured.
Katie can sue Joe for her damages. However, Joe may not have any assets to satisfy a judgment.
If Katie has private health insurance, her medical bills will be covered. However, she will be responsible for her deductibles and co-pays. Katie may also be entitled to California disability insurance or other benefits through her employer. If not, she is out of luck.
- Example 2: Joe has the minimum 15/30/5 liability coverage
The maximum Joe’s insurance will pay for any one person in any one accident is $15,000, which is all Katie will be able to recover. She will be responsible for the balance of her losses and will not be able to get anything additional for her pain and suffering.
Note that this would also be the case if Joe’s liability limits are any amount less than $75,000 per person.
- Example 3: Joe has 100/300/25 car insurance
In this scenario, Joe has enough insurance to pay Katie or her full out-of-pocket losses of $75,000. In addition, there is enough coverage for her possibly to recover something additional for pain and suffering.
- Example 4: Joe has no car insurance but Katie has UMC/UIM coverage
Since Katie has uninsured motorist coverage she can collect up to the limits of her policy from her own insurer. So if Katie has the minimum 15/30/5 coverage, she will be able to collect $15,000 for her injuries and another 5,000 in property damage. If she has higher limits to her coverage she will be able to collect more still.
6. The claims process
Many UMC/UIM claims resolve without litigation. You file a claim with your own insurance company, which is obligated under the California Fair Claims Settlement Practices Regulations to promptly and thoroughly investigate the claim and make a good faith effort to settle it fairly.
If your insurer unreasonably delays the claims process or fails to evaluate and settle the claim fairly, you may have grounds for a bad faith lawsuit against your insurer.5
If you and your insurer disagree on the claim’s value, your policy may require that your case go to binding arbitration rather than a jury trial. In arbitration, a neutral arbitrator (often a retired judge or experienced attorney) hears evidence from both sides and renders a decision.
Whether you are fighting your insurer through arbitration or a trial – which are legally complex processes – you are advised to hire an attorney to represent you.
Additional resources
For more information, refer to the following:
- Automobile Insurance Information Guide – Official consumer guide explaining UM/UIM coverage in plain language.
- Navigating the maze of uninsured and underinsured motorist coverage – Helpful article by Advocate.
- California Car Insurance Guide – DMV.org provides general info including a section on UM/UIM requirements and facts for California drivers.
- Insurance Information Institute – Compulsory Auto/Uninsured Motorists – National overview of UM/UIM insurance with useful statistics.
- What is Uninsured Motorist Coverage? – Overview by Forbes.
Legal references:
- California Insurance Code 11580.1b. Most insurers offer higher insurance limits, such as up to $100,000 per person and $300,000 for total bodily injury per accident. See also California Insurance Code sections 11580.2–11580.5. Facts + Statistics: Uninsured motorists, Insurance Information Institute.
- Smith v. State Farm Mut. Auto. Ins. Co. (2001) 93 Cal.App.4th 700.
- Daun v. USAA Casualty Ins. Co. (Cal.App. 2005) 125 Cal.App.4th 599 (“In summary, section 11580.2 mandates UM and UIM coverage to the named insured regardless of whether the individual is in a motor vehicle or on a horse, motorcycle, bicycle or stilts when injured by an uninsured or underinsured motorist, so long as one of the statutory exclusions does not apply.”).
- Automobile Coverage Limits, California Department of Insurance.
- Wilson v. 21st Century Ins. Co (2007) 42 Cal.4th 713; Brehm v. 21st Century Ins. Co (2008) 166 Cal.App.4th 1225.