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What is Uninsured/Underinsured Motorist Coverage and What Does it Cover?

UM/UIM coverage provides coverage if you are hit by someone who did not have insurance or did not have enough insurance to pay your medical and car repair bills. It also provides cover if you are involved in a hit-and-run accident and are unable to identify the at-fault party.  The Texas Insurance Code requires UM/UIM coverage in a personal auto policy, unless it is specifically rejected in writing.

The Texas Insurance Code defines “uninsured or underinsured motorist coverage” as “the provisions of an automobile liability insurance policy that provide for coverage in the least the limits prescribed by Chapter 601, Transportation Code, that protects insureds who are legally entitled to recover from owners or operators of uninsured or underinsured motor vehicles damages for bodily injury, sickness, disease, or death, or property damage resulting from the ownership, maintenance, or use of any motor vehicle.”  It defines “uninsured motor vehicle” to also include “an insured motor vehicle as to which the insurer providing liability insurance is unable because of insolvency to make payment with respect to the legal liability of the insured within the limits specified in the insurance.” It further defines “underinsured motor vehicle” as “an insured motor vehicle on which there is collectible liability insurance coverage with limits of liability for the owner or operator that were originally lower than, or have been reduced by payment of claims arising from the same accident to, an amount less than the limit of liability stated in the underinsured coverage of the insured’s policy.”

The Texas Insurance Code (see, e.g., Tex. Ins. Code §1952.101-110) also provides the following with regard to UM/UIM coverage:

  • UM/UIM limits may not exceed liability limits.
  • UM/UIM coverage cannot cover intentional acts, and if the owner or operator of the vehicle is unknown, then actual contact between the vehicles is required.
  • UM/UIM limits, including property damage, must be offered up to the amount of the liability limits
  • A $250.00 deductible for property damage applies.
  • UM/UIM limits must at least equal Safety Responsibility Limit Uninsured Motorist Coverage
  • UM/UIM coverage pays for “all amounts the insured is legally entitled to recover as damages” from the uninsured vehicle up to the limits of the policy “because of bodily injury or property damage.”
  • A policyholder can elect to claim under their UM/UIM coverage or their collision coverage and choose the lesser deductible. A policyholder may also stack collision and UM/UIM property damage coverage and pay only the lesser deductible. The policyholder, however, cannot recover more than their actual damages.
  • The UM/UIM carrier has subrogation rights against any person or organization legally responsible “for the loss, subject to the terms of the policy.”
  • Venue is mandatory, in the event of a lawsuit, in either the county of the collision or the policyholder’s county of residence at the time of the collision.

Take extra caution when reviewing your insurance documents and be sure you do not reject this coverage as part of the execution of documents prepared by your insurer.  It provides vital coverage in the event you are hit by an uninsured or underinsured driver.  Also, it is good practice to be sure you tell your agent you want this coverage.

The lawyers of LeMaster & Ahmed PLLC are here to help those that suffer personal injuries as a result of car accidents.  Contact us at our Houston location at 832-356-7983 or our DFW location at 972-483-0410. You can also message us any inquiries directly on our website.

***The foregoing is not meant to serve as legal advice relating to your personal injury claim. Please contact one of our lawyers if you have questions specific to your particular insurance issue.

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