Uninsured and underinsured motorist coverage (UM/UIM) provides critical financial protection that many drivers underestimate—until they need it. In a state like California, where thousands of drivers either lack insurance or carry only the minimum limits, UM/UIM coverage can be the only safety net between you and financial devastation after a crash. These types of uninsured and underinsured accidents can leave victims with unexpected bills and limited legal clarity.
What is an Uninsured Motorist?
An uninsured motorist is a driver who does not carry auto liability insurance as required by California law. Despite legal requirements, the Insurance Research Council estimates that approximately 16% of California drivers are uninsured. If an uninsured driver causes a crash, they typically have no means to cover their medical bills, lost wages, or other damages.
Without UM coverage, you may be forced to pay out of pocket or pursue a lawsuit against a driver who likely lacks the assets to pay a judgment. Uninsured motorist coverage allows you to recover compensation through your own insurer as if the at-fault driver had liability insurance. It also applies in hit-and-run accidents where the driver cannot be identified and pedestrian accidents caused by an uninsured driver.
What is an Underinsured Motorist?
An underinsured motorist is a driver who has insurance, but not enough to cover the full cost of your damages. California’s minimum liability limits are $15,000 per person and $30,000 per accident for bodily injury. These amounts are often far too low in serious collisions involving hospitalization, surgery, rehabilitation, or long-term disability.
Underinsured motorist coverage pays the difference between the at-fault driver’s policy limit and your actual damages—up to the limits of your UIM coverage. For example, if your damages total $100,000 and the at-fault driver carries only $15,000 in liability coverage, your UIM coverage could help make up the $85,000 gap.
The Financial Risks of Skipping UM/UIM Coverage in California
Choosing to decline UM/UIM coverage may save a small amount on your premium, but it leaves you vulnerable to significant financial losses. Medical costs alone after a severe crash can exceed $50,000 or more. If the at-fault driver is uninsured or underinsured, you may have no recourse without this added protection. Risks include:
Paying for emergency treatment, surgeries, or long-term care yourself
Missing work without compensation for lost wages
Facing long-term disability without financial support
Limited ability to recover non-economic damages such as pain and suffering
California does not require UM/UIM coverage, but insurance companies must offer it. Drivers who decline it must do so in writing.
How Insurers Limit UM/UIM Payouts
UM/UIM policies are designed to act as a safety net, not a full compensation source. Therefore, insurers often attempt to limit UM/UIM payouts to control claim costs and increase their bottom line, through:
Policy limits: Your compensation cannot exceed the UM/UIM coverage amount you purchased. If your losses exceed your limits, you may be left without full reimbursement.
Offset clauses: Some insurers subtract the amount paid by the at-fault driver’s insurance from your UM/UIM payout, reducing your recovery.
Disputes over damages: Insurers may challenge the extent of your injuries, question medical treatment, or dispute wage loss claims.
Mandatory arbitration: UM/UIM claims often require arbitration, not court, which limits discovery and can affect your leverage.
Having an uninsured and underinsured accident lawyer in Fresno on your side during the claims process is critical. They can help you counter these tactics and maximize your compensation.
How Much Coverage Do You Need?
The amount of UM/UIM coverage you need depends on your financial situation and your level of risk tolerance. As a guideline:
Carry at least $100,000 per person / $300,000 per accident in UM/UIM coverage to match typical medical costs in moderate-to-severe injury cases.
Consider higher limits if you regularly drive in high-traffic areas, have dependents, or lack other forms of financial protection.
Match your UM/UIM limits to your liability limits. This provides balanced coverage and protects both your assets and your recovery options.
Keep in mind that you cannot buy UM/UIM coverage in an amount higher than your liability coverage, so increasing both may be necessary.
Common Myths About UM/UIM Coverage
Many drivers misunderstand how UM/UIM coverage works, which can lead to costly mistakes. Below are some of the most common myths—and the facts that counter them:
“I have health insurance, so I do not need UM/UIM coverage.” Health insurance may cover medical treatment, but it does not pay for lost wages, pain and suffering, or future earnings. UM/UIM coverage can compensate for all of these damages, filling in critical financial gaps.
“UM/UIM coverage is only for medical expenses.” In reality, this coverage may also include compensation for lost income, emotional distress, long-term disability, and other economic and non-economic damages resulting from the crash.
“I can sue the uninsured driver instead.” While you can file a lawsuit, most uninsured drivers have few assets. Winning a judgment does not guarantee payment.
“UM/UIM coverage is too expensive.” Compared to the potential losses you could face in a serious accident, UM/UIM premiums are relatively low.
Protecting Your Rights After a Crash
If you are hit by an uninsured or underinsured driver, take the following steps to protect your legal and financial rights:
Get Medical Attention: Seek treatment for all injuries, even minor ones, and keep records of all care received.
Notify Your Insurer Promptly: Report the accident to your insurer and indicate that you may need to file a UM/UIM claim.
Do Not Accept a Quick Settlement: Insurance companies often offer low settlements early to avoid paying full compensation.
Consult a Lawyer: An attorney can help gather evidence, calculate full damages, and handle all negotiations or arbitration with your insurer.
Delays or mistakes in the early stages can weaken your claim. Working with our skilled Fresno uninsured and underinsured accident attorneys at Freedman Law significantly increases the likelihood of receiving the compensation you deserve.
