UM/UIM Coverage in California: What Injured Drivers Should Know
Uninsured and underinsured motorist coverage can become important when the responsible driver has no insurance or does not have enough liability insurance to fully address the claim. California regulates this coverage through Insurance Code section 11580.2, but the actual policy remains important.
UM and UIM are related but different
Uninsured motorist coverage may apply when the responsible vehicle lacks applicable liability insurance or falls within another statutory definition of an uninsured motor vehicle.
Underinsured motorist coverage addresses a different situation: the responsible vehicle has liability insurance, but its applicable liability limits are lower than the injured insured’s UIM limits.
UIM generally requires exhaustion
California’s statute generally provides that underinsured-motorist coverage does not apply until the applicable bodily-injury liability limits of all insured vehicles causing the injury have been exhausted by judgments or settlements and proof of payment has been submitted to the UIM carrier.
The UIM carrier receives a credit
The maximum UIM payment generally does not exceed the insured’s UIM limit minus amounts paid by or for persons or organizations legally responsible for the injury.
UM disputes are generally arbitrated
Insurance Code section 11580.2 provides that disputes concerning whether the insured is legally entitled to recover damages and the amount of those damages are determined by agreement or, if the parties disagree, by arbitration before a single neutral arbitrator.
California has a separate two-year preservation rule
A UM cause of action generally does not accrue unless one of the statutory actions occurs within two years from the accident. One method is formally instituting arbitration through written notice sent by certified mail, return receipt requested, in the manner specified by the statute. Opening a claim or discussing it informally should not be assumed to satisfy this requirement.
Hit-and-run claims have additional requirements
When the responsible driver is unknown, California’s statutory UM definition generally requires physical contact, a police report within 24 hours, and the sworn insurer statement within 30 days.
Policy language still matters
Coverage can be affected by who qualifies as an insured, vehicle use, exclusions, rejection or reduction forms, workers’ compensation, MedPay, other applicable insurance, and the specific facts of the collision.
Glendale Law Group handles UM and UIM injury claims and arbitrations throughout Southern California. Call (818) 745-0101 for a free consultation.
This article provides general information only and is not legal advice. Reading it does not create an attorney-client relationship. Deadlines and rights depend on the facts, applicable law, and insurance policy language.
