The primary difference between uninsured and underinsured drivers is whether they carry liability insurance. An uninsured driver does not carry any form of car insurance. An underinsured driver carries liability but their policy limits aren't high enough to cover your vehicle damage and personal injuries.
Car insurance
is an essential requirement in nearly every state, but while state laws may mandate it, there are still drivers without proper protection. According to a 2021 study by the Insurance Research Council (IRC), 12.6% of drivers—that’s about 1 in 8 drivers—were uninsured in 2019.So, what happens if you’re involved in an accident and the other driver doesn’t have enough liability coverage—or worse, doesn’t have any coverage? That’s where underinsured and uninsured motorist coverages come into the picture. If you’re confused about the difference between the two and what you need, we’re here to answer all your questions.
What’s the difference between being uninsured and underinsured?
The primary difference between underinsured and uninsured motorists is whether they carry liability insurance
. Underinsured drivers have car insurance—usually only basic liability—but their limits are too low to fully compensate the victim if they’re involved in an at-fault accident. That means the driver could be adequately insured for a minor crash but underinsured for a serious one.
Uninsured drivers, on the other hand, do not have car insurance at all. In the event of an at-fault accident, they would not have coverage. In most states, auto insurance is a legal requirement and driving without insurance
can lead to severe consequences. New Hampshire
and Virginia
are the only states that do not require drivers to carry car insurance. While underinsured and uninsured drivers are different, there is one similarity: they will be held personally liable for any costs their insurer does not cover.
MORE: What is uninsured motorist bodily injury coverage?
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What does uninsured/underinsured motorist coverage (UM/UIM) pay for?
Like liability coverage, uninsured and underinsured motorist coverage is broken down into bodily injury and property damage.
Uninsured/underinsured motorist bodily injury coverage (UMBI/UIMBI)
If you’re involved in an accident with an uninsured or underinsured driver, uninsured/underinsured motorist bodily injury helps cover the costs of medical bills, lost wages, and pain and suffering for you or your passengers. While some states require drivers to have medical payments (MedPay)
coverage or personal injury protection (PIP)
, limits may not be as high as UMBI or UIMBI coverage. Uninsured/underinsured motorist property damage coverage (UMPD/UIMPD)
Uninsured motorist property damage (UMPD) and underinsured motorist property damage (UIMPD) offer financial compensation for your vehicle if someone hits you and doesn’t have enough or any insurance to cover the damages.
For example, if a driver hits you and causes significant damage to your vehicle but doesn’t have enough insurance to cover the full repair or replacement costs, this coverage would cover the remaining repairs up to the policy limits. In some states, UM/UIM coverage is required, while in others, they are additional coverages that can be added to your auto insurance policy.
Here’s a breakdown of what each covers:
Uninsured/underinsured motorist bodily injury coverage | Accident-related medical expenses Pain and suffering resulting from an accident
|
|---|
Uninsured/uninsured motorist property damage coverage | Vehicle repairs and replacement Personal property within your car
|
Key Takeaway UM/UIM coverage can be helpful if you’re involved in an accident with a driver who doesn’t carry enough insurance to cover the cost of the damage or injury.
What happens if an uninsured driver hits you?
If you’re involved in a motor vehicle accident and find out that the other driver doesn’t have insurance, what do you do?
Under normal circumstances (the other driver has insurance), you'd file a claim with the at-fault driver's insurance provider, get your car repaired, and recoup compensation for any lost wages or medical expenses—and all of this would be at no cost to you.
But if the other driver doesn’t have an insurance provider to file a claim, you’ll need uninsured motorist insurance to receive compensation. Here’s how to file a claim if you’re in this situation.
First, detail as much information as possible about the incident (location, time, the extent of damage, etc.). Before filing your claim, you’ll also want to have:
Insurance information from the other vehicle(s) involved in the accident
Name and address of your preferred auto shop
Once you have all this information, it’s time to file an uninsured motorist claim:
Call your insurance provider
Tell them you need to file a claim
Briefly explain the details of the situation
Provide them with any information that you have if they ask for it
Follow all of their instructions, and answer any questions they may have to the best of your ability
Once you’ve filed the claim, your insurance company will let you know about the next steps. If the claim is approved, your insurance provider will cover the cost of damages and medical expenses up to your policy limit.
MORE: How to negotiate a settlement with insurance claims adjusters
4.7/5 rating on the App Store | Trusted by 5+ million customers and 7 million cars4.7/5 app rating | Trusted by 5M+ drivers What happens if an underinsured driver hits you?
If you’ve been involved in a car accident with an underinsured driver, the process is similar to an uninsured driver. But because the other party involved has some insurance—just not enough to cover the entire bill for damages—your UIM policy will kick in.
Under these circumstances, the insurer for the other driver will pay for your medical expenses and property damage up to that driver’s policy limit. If you have underinsured motorist coverage (UIM), you can file a claim with your insurance provider to cover the remaining costs. Once approved, your insurer will pay the remaining amount up to your policy limit.
Let’s say the at-fault driver has $15,000 in bodily injury coverage per person but your medical bills add up to over $40,000. Their insurance company would pay for the first $15,000 in medical expenses and your insurer would pay the remaining $25,000, assuming your UIM bodily injury limit per person is $25,000 or more. If it doesn’t cover the full amount, the remainder will come out of pocket.
Do you need UM/UIM car insurance coverage?
In most states, uninsured and underinsured motorist protection isn’t required, meaning it comes at an additional cost and add-on to your existing policy. But some states require drivers to carry UM/UIM coverage to legally get behind the wheel of a car.
Here’s how it breaks down:
| Coverage required and minimum liability limits |
|---|
| UMBI: $25,000 per person, $50,000 per accident |
| UMBI: $25,000 per person, $50,000 per accident UMPD: $5,000 per accident |
| UMBI: $25,000 per person, $50,000 per accident |
| UMBI: $25,000 per person, $50,000 per accident |
| UMBI: $50,000 per person, $100,000 per accident |
| UMBI: $30,000 per person, $60,000 per accident UMPD: $15,000 per accident |
| UMBI: $20,000 per person, $40,000 per accident |
| UMBI: $25,000 per person, $50,000 per accident |
| UMBI: $25,000 per person, $50,000 per accident |
| UMBI: $25,000 per person, $50,000 per accident |
| UMBI: $25,000 per person, $50,000 per accident UMPD: $25,000 per accident |
| UMBI: $25,000 per person, $50,000 per accident |
| UMBI: $30,000 per person, $60,000 per accident UMPD: $25,000 per accident |
| UMBI: $25,000 per person, $50,000 per accident |
| UMBI: $25,000 per person, $50,000 per accident |
| UMBI: $25,000 per person, $50,000 per accident UMPD: $25,000 per accident |
| UMBI: $25,000 per person, $50,000 per accident |
| UMBI: $50,000 per person, $100,000 per accident UMPD: $10,000 per accident |
| UMBI: $25,000 per person, $50,000 per accident UMPD: $20,000 per accident |
| UMBI: $25,000 per person, $50,000 per accident UMPD: $25,000 per accident |
| UMBI: $25,000 per person, $50,000 per accident |
For some drivers, deciding between UM/UIM and other types of car insurance—like MedPay and PIP—can be confusing. For example, MedPay covers the cost of accident-related injuries within the limits of its coverage, but coverage limits for MedPay are generally lower than UM/UIM coverages. While MedPay might work for low-limit claims, it falls short when the loss is significant. PIP is much the same, although some states offer slightly higher limits and a deductible.
Remember that health insurance, MedPay, and PIP do not cover property damage. If you want to protect yourself against unexpected costs, investing in UM/UIM might be worth it.
MORE: How many drivers are uninsured?
