How Do Uninsured and Underinsured Motorist (UM/UIM) Claims Work?

After a car accident, the path to recovery can feel unclear, especially when the other driver lacks adequate insurance. Suddenly, you aren’t just dealing with injuries; you’re facing uncertainty about how your medical bills and lost wages will be paid. At Saavedra Law Firm, we understand this stress. We help injury victims navigate these complex situations every day, ensuring they have the clarity and support needed to move forward.

Here’s what accident victims should know about UM/UIM insurance claims in Arizona:

• UM Coverage safeguards you if the at-fault driver has no insurance at all.
• UIM Coverage steps in when the at-fault driver’s policy limits are too low to cover your total damages.
• Stacking Policies (if applicable) allows you to combine coverage limits from multiple vehicles for higher compensation.
• Your Own Insurance is who you claim against in UM/UIM cases, which can sometimes lead to disputes.
• Legal Action may still be necessary if your insurer undervalues or denies your valid claim.

What is the difference between UM and UIM coverage in Arizona?

While they are often grouped together, Uninsured Motorist (UM) and Underinsured Motorist (UIM) coverages serve different purposes. Both are designed to protect you, the policyholder, rather than other drivers.

• Uninsured Motorist (UM): This applies when the driver who hit you has zero liability insurance. It also covers you in hit-and-run scenarios where the at-fault driver cannot be identified. In Arizona, approximately 12% of drivers are uninsured, making this coverage vital.
• Underinsured Motorist (UIM): This kicks in when the at-fault driver has insurance, but their policy limits are insufficient to cover the full cost of your injuries. For example, if your medical bills total $50,000 but the other driver only carries the state minimum of $25,000 for bodily injury, UIM coverage can bridge that $25,000 gap.

How does “stacking” affect my insurance claim?

One of the most complex aspects of UM/UIM claims involves “stacking.” This refers to the ability to combine the coverage limits of multiple insurance policies or multiple vehicles on a single policy to increase the total amount of money available for a claim.

Arizona law regarding stacking is nuanced. Under Arizona Revised Statute § 20-259.01,  UM/UIM can be stacked within a single policy unless the policy prohibits it in clear language. Reviewing the specific language of your insurance contract with an attorney is the only way to be certain about what coverage is available to you.

Why do I have to file a claim against my own insurance company?

It can feel counterintuitive to file a claim against your own insurance company when the accident wasn’t your fault. However, because the at-fault driver either lacks money or insurance, your insurance provider steps into the shoes of the at-fault driver.

When you file a UM or UIM claim, your relationship with your insurer shifts. Instead of being your advocate, they become the entity responsible for paying the damages. Consequently, they may scrutinize your medical records, question the severity of your injuries or argue that the accident didn’t cause your specific medical issues. Their goal is often to minimize the payout, which is why having legal representation is crucial during this process.

When is a lawsuit necessary in a UM/UIM case?

Many people assume that because they have paid their premiums on time, their insurance company will automatically pay the full value of a UM/UIM claim. Unfortunately, this is not always the case. A lawsuit may become necessary if:

• Valuation Disputes: The insurance adjuster offers a settlement that is far lower than the actual cost of your medical care, lost income and pain and suffering.
• Claim Denial: The insurer denies that the uninsured driver was at fault or denies that your injuries resulted from the crash.
• Bad Faith: If the insurance company unreasonably delays payment or fails to investigate the claim properly, you may need to file a lawsuit not just for the accident damages, but for “bad faith” insurance practices.

How can an attorney help with my claim?

Navigating an insurance claim while trying to recover from injuries is exhausting. By hiring a personal injury attorney, you level the playing field. An experienced lawyer can handle the communication with the insurance adjusters, interpret the fine print of your policy and gather the necessary medical evidence to prove the full extent of your damages.

If you or a loved one has been injured by an uninsured or underinsured driver, don’t face the insurance companies alone. Contact Saavedra Law Firm now for a free consultation. Our mission is to help you regain control of your life and ensure you receive the compensation you rightfully deserve.