Updated July 2026
What Is Uninsured and Underinsured Motorist Coverage Insurance?
Uninsured motorist coverage (UM) pays for your medical bills, lost wages, and vehicle damage when an at-fault driver has no insurance. Underinsured motorist coverage (UIM) kicks in when the at-fault driver's liability limits are too low to cover your full losses. Both coverages protect you from paying out-of-pocket for someone else's mistake when their policy can't or won't cover what they owe you.
- You're stopped at a red light. The driver behind you doesn't brake in time and rear-ends your car. You have $8,000 in medical bills and $5,000 in vehicle damage. The at-fault driver has no insurance. Your UM coverage pays the $8,000 in medical costs. Your collision coverage (if you carry it) pays the $5,000 vehicle damage minus your deductible. Without UM, you'd pay the medical bills yourself or sue the driver—who likely has no assets to collect.
- Another driver runs a stop sign and T-bones your car. You suffer a broken collarbone and miss six weeks of work. Your medical bills total $22,000 and lost wages add another $6,000. The at-fault driver carries only the state minimum liability limit of $20,000 per person. Their insurer pays the $20,000 maximum. Your UIM coverage pays the remaining $8,000. Without UIM, you'd absorb that $8,000 loss or pursue the driver personally—a process that can take years and often recovers nothing.
- You return to your parked car and find the driver's side door caved in. No note, no witnesses, no camera footage. Your collision coverage pays for the vehicle repair minus your deductible. UM property damage coverage (if your state offers it and you purchased it) may also apply, but most UM policies require you to identify the at-fault driver or prove they were uninsured. In most hit-and-run cases, you're relying on collision coverage, not UM.
Who Needs Uninsured and Underinsured Motorist Coverage Insurance?
You should carry UM/UIM if you live in a state where a significant percentage of drivers are uninsured, if you can't afford to pay medical bills out-of-pocket after a crash, or if you carry high liability limits and want matching protection for yourself. It's especially important if you don't have health insurance or if your health plan has high deductibles—UM pays immediately without waiting for a lawsuit.
Compare the annual premium to your health insurance deductible and out-of-pocket maximum. If your health plan would leave you with $5,000 in costs after a serious crash and UM/UIM costs $150 per year, the coverage pays for itself in one claim. If your health coverage is strong and your state's uninsured rate is below 10 percent, the math shifts—but most drivers still buy it because the cost is low and the downside of going without is catastrophic.
How Much Does Uninsured and Underinsured Motorist Coverage Insurance Cost?
UM/UIM coverage typically adds $8 to $18 per month to your premium, or roughly $96 to $216 annually, depending on the limits you select and your state's uninsured driver rate.
- Limits you select—UM/UIM is usually sold in the same increments as liability coverage, so choosing $100,000/$300,000 UM costs more than $25,000/$50,000.
- Your state's uninsured motorist rate—states with higher percentages of uninsured drivers charge more because the risk of a claim is higher.
- Whether you add UM property damage coverage—some states let you add this as a rider to cover vehicle damage from uninsured drivers, which increases the premium slightly.
- Your own driving record—even though UM covers you when someone else is at fault, insurers price it based on overall risk, so a clean record keeps costs lower.
- Stacking rules in your state—if your state allows stacking (combining UM limits across multiple vehicles on one policy), premiums are higher but coverage is deeper.