Uninsured/underinsured motorist coverage explained (UM/UIM)

If the other driver in your accident has no insurance — or not enough of it — your own policy is what pays. That's the entire premise of uninsured/underinsured motorist (UM/UIM) coverage, and it's a bigger deal than it sounds: per a 2023 Insurance Research Council study cited by the National Association of Insurance Commissioners, about 15.4% of motorists nationally — roughly one in seven — were uninsured, even though every state except New Hampshire requires drivers to carry liability insurance.

What UM/UIM coverage actually pays for

Per NAIC, uninsured motorist (UM) coverage compensates you and your passengers if you're injured or your vehicle is damaged in a collision with a driver who has no insurance at all. Underinsured motorist (UIM) coverage is the companion piece: it steps in when the at-fault driver does have insurance, but their liability limits are too low to cover your medical bills or vehicle damage — the same coverage "fills the gap" between what they carry and what you actually need.

Two related coverage types often travel with UM/UIM but aren't the same thing:

• Uninsured motorist bodily injury (UMBI) — covers medical costs, lost wages, and related expenses from an at-fault uninsured driver.
• Uninsured motorist property damage (UMPD) — covers repair or replacement of your own vehicle. Some states fold this into UMBI, others sell it separately or don't offer it at all — check your own policy's declarations page.

If you're comparing this to personal injury protection (PIP), which pays your own medical bills regardless of fault, the distinction is worth keeping straight: PIP is about your fault-blind medical coverage, while UM/UIM is specifically about the other driver's thin or missing coverage.

Why this coverage matters more than it sounds

Every state except New Hampshire requires drivers to carry auto liability insurance, per NAIC — but a legal requirement doesn't mean universal compliance. NAIC's cited 2023 IRC study found uninsured rates ranging from 5.7% in Maine (the lowest) to 28.2% in Mississippi (the highest). The Insurance Information Institute cites the same research program with a slightly different vintage — 2022 claims data putting the national rate at 14.0%, with Washington, D.C. highest at 25.2% and Wyoming lowest at 5.9%. The two figures don't match exactly (different data years within the same IRC research program), but the takeaway is the same either way: somewhere between one in seven and one in six drivers you might get into an accident with may not be carrying insurance at all — and III notes the national rate jumped to 13.9% in 2020 and has stayed in roughly that range since.

Underinsurance compounds the problem. Many states set liability minimums low enough that a driver can be fully "legal" while carrying limits that don't come close to covering a serious injury claim — which is exactly the scenario UIM coverage is built for. For more on how those state-minimum numbers work, see how auto liability limits work.

Is UM/UIM coverage required where you live?

It depends — and this is a narrower question than "is liability insurance required," which is a near-universal yes. Per III, 20 states plus Washington, D.C. specifically require UM/UIM coverage, including Connecticut, Illinois, Maine, Maryland, Minnesota, Missouri, Nebraska, New Jersey, New York, North Carolina, North Dakota, Oregon, South Carolina, South Dakota, Vermont, Virginia, West Virginia, and Wisconsin. In states without a mandate, UM/UIM is typically offered as an optional add-on you have to ask for. Requirements and exact minimums vary by state and change over time, so confirm your own state's current rule with your insurer or state insurance department rather than assuming based on a neighboring state.

What to check on your own policy

1. Confirm whether you have it at all. If your state doesn't mandate UM/UIM, it's possible your policy doesn't include it unless you asked for it.
2. Check your limits, not just whether the box is checked. UM/UIM is commonly sold with its own limits, separate from your liability limits — a low UM/UIM limit can leave you underprotected even if you technically "have" the coverage.
3. Ask whether UMPD (property damage) is included or separate. Some states bundle it with bodily-injury UM coverage; others don't offer it at all, meaning your collision coverage (and its deductible) would be what pays for vehicle damage from an uninsured driver instead.
4. Revisit this after a move. Since UM/UIM mandates and minimums are state-specific, a policy that met one state's requirements may not automatically match what a new state requires or offers.

The bottom line

You can't control whether the other driver in an accident is carrying enough insurance — or any at all. UM/UIM coverage is the part of your own policy built specifically for that risk, and with national uninsured-driver rates running somewhere between one in seven and one in six drivers depending on the data source and year, it's not a fringe scenario. Check your declarations page for your current UM/UIM limits, ask your insurer whether your state mandates this coverage, and if you're ever in an accident, here's how to file an auto insurance claim.

ClearValue Insure is an educational publisher and comparison resource — we don't sell, underwrite, or issue auto insurance policies. For your specific state's requirements or a quote on UM/UIM limits, talk to your auto insurer, your state insurance department, or a licensed agent directly.