UM/UIM

UM/UIM Coverage Situations

• UM (Uninsured Motorist) and UIM (Underinsured Motorist) coverage applies when the insured is involved in an accident caused by a driver with insufficient or no insurance coverage.
• Coverage can also apply if an accident occurs hit-and-run or when an insured vehicle is struck by an uninsured vehicle.
• If the client is a passenger, UM/UIM coverage may apply if the vehicle they were in has applicable coverage or if they have their own UM/UIM policy.

Situations Leading to Non-Application

• UM/UIM coverage may not apply if the insured is driving a vehicle not covered under their policy.
• Situations where the insured did not maintain required insurance or when fraud is involved may also lead to non-application.
• Consult with an adjuster to explore coverage options in ambiguous situations.

Policy Limits and Recoveries

• With a UM/UIM policy of 100/300 and a defendant's policy limit of 25/50, potential recovery can be limited due to the lower limit of the defendant’s policy. Exact recovery amounts depend on fault and the extent of damages.
• For DEF policy limits of 50/100 and a UM/UIM policy of 25/50, the potential recovery per person may be capped at 25,000, depending on damages incurred.
• The policy limits for UM/UIM coverage do not automatically combine with the defendant's liability limits; each operates independently concerning recovery amounts.

Misconceptions About UM/UIM Coverage

• A common misconception is that UM/UIM coverage will pay out as much as defendant's liability coverage; however, these limits are distinct and not cumulative.