Hearing the words, "That's all the insurance they have," can feel like the rug has been pulled out from under you. You're still dealing with doctor appointments, time away from work, and a growing stack of bills. Then comes another surprise: the at-fault driver's insurance may not be enough to cover your losses.

This is exactly why underinsured motorist (UIM) coverage exists. Depending on your insurance policy and the laws in your state, it may provide an additional source of coverage when the other driver's liability limits fall short. The National Association of Insurance Commissioners (NAIC) explains that uninsured and underinsured motorist coverage is designed to protect insured drivers when the at-fault motorist has no insurance or not enough insurance to pay for covered damages, though the availability of this coverage varies by state and policy.

The other driver's policy isn't always the whole picture. A car accident lawyer can help connect the dots. Read on to discover how underinsured motorist claims generally work, when they may apply, what evidence often matters, and why reviewing your own policy can be an important next step.

Key Takeaways: Underinsured Motorist Claims for Car Accidents

• Underinsured motorist (UIM) coverage may help when the at-fault driver's liability insurance isn't enough to cover your losses.
• A UIM claim is generally made through your own insurance company, even though another driver caused the crash.
• Eligibility, available benefits, and claims procedures depend on both state law and your insurance policy.
• Medical records, proof of damages, and insurance documents often become key pieces of evidence.
• Accepting the at-fault driver's policy limits doesn't always mean every available source of coverage has been explored.

How Do Underinsured Motorist Claims Work After a Car Accident?

Most car accident claims begin with the driver who caused the crash. Their liability insurance is usually the first source of compensation for injuries and property damage.

Underinsured motorist coverage most often refers to bodily injury losses, although some states and policies may also provide underinsured motorist property damage coverage.

The picture changes when the available coverage doesn't match the losses. A hospital stay, surgery, months of physical therapy, or permanent injuries can quickly exceed the liability limits carried by the at-fault driver.

If you purchased underinsured motorist coverage and your state recognizes it, your own policy may provide additional benefits after the other driver's available liability coverage has been addressed. The exact process depends on state law and the language of your insurance contract. Some states require the at-fault driver's policy limits to be exhausted before UIM benefits become available, while others follow different procedures.

Although the claim may involve your own insurance company, the insurer will still review liability, the extent of your injuries, and the value of your damages before determining how the policy applies.

What Is the Difference Between Uninsured and Underinsured Motorist Coverage?

These two coverages are often mentioned together, but they protect against different situations.

Uninsured motorist (UM) coverage generally applies when the at-fault driver has no liability insurance. Depending on state law, it may also apply to certain hit-and-run accidents.

Underinsured motorist (UIM) coverage applies when the at-fault driver has insurance, but the available policy limits aren't enough to fully cover the injured person's losses.

Here's a simple example.

A driver carries a $50,000 bodily injury liability policy. Your medical expenses, lost wages, and other covered damages total $175,000. If your policy includes applicable UIM coverage, it may help cover part of the remaining losses, subject to your policy limits and your state's insurance laws.

The distinction matters because the claims process, policy requirements, and available benefits may differ depending on whether the driver was uninsured or underinsured.

When Can You File an Underinsured Motorist Claim?

There's no single timeline that applies in every state.

Before a UIM claim can move forward, several questions usually need to be answered. Was the other driver responsible for the collision? How much liability coverage is available? How extensive are the injuries? Does your own policy include underinsured motorist coverage?

Some policies also require the injured person to notify their own insurer and obtain consent before settling with the at-fault driver, because settling without consent may affect the insurer’s subrogation rights and the availability of UIM benefits.

In many cases, a UIM claim doesn't become part of the discussion until it's clear that the at-fault driver's insurance won't fully cover the damages.

Determining Whether the At-Fault Driver's Coverage Is Insufficient

The severity of the injuries often shapes this conversation.

Consider someone who suffers multiple fractures in a high-speed collision. Between emergency care, surgery, rehabilitation, follow-up appointments, and several months away from work, the financial impact can grow quickly.

Now compare those losses to an at-fault driver carrying only the minimum liability insurance required in their state. Even though the driver was insured, the available coverage may be exhausted long before every loss has been addressed.

This is one reason underinsured motorist coverage can become so important. The Insurance Information Institute notes that many drivers purchase uninsured and underinsured motorist limits such as $25,000 per person and $50,000 per accident, although higher limits are available depending on the insurer and the policy selected.

Whether those limits are enough depends entirely on the circumstances of the crash and the injuries involved.

What Damages Can Be Covered by Underinsured Motorist Benefits?

The purpose of UIM coverage is to help address losses that exceed the at-fault driver's available liability insurance. Exactly what is covered depends on the insurance policy and the laws of the state where the claim is made.

Depending on those factors, benefits may include:

• medical expenses
• future medical treatment
• lost wages
• reduced earning capacity
• pain and suffering where permitted under applicable law
• permanent disability or impairment in qualifying cases

Coverage is still limited by the amount of UIM insurance purchased. For example, having $250,000 in damages doesn't automatically mean the policy will pay that amount. Policy limits, offsets, exclusions, and other provisions can all affect how much coverage is ultimately available.

For this reason, reviewing both the at-fault driver's policy and your own insurance coverage is often an important part of understanding the full picture.

How the Underinsured Motorist Claims Process Works

Once it becomes clear the at-fault driver's insurance won't fully cover the losses, the process often shifts to your own insurance company.

That surprises many people. Even though someone else caused the crash, an underinsured motorist claim is generally based on your own insurance contract.

Your insurer may still evaluate many of the same facts involved in proving negligence in a car accident claim, including how the collision occurred and who was legally responsible.

Every claim follows its own path, but the process often includes:

• reviewing the at-fault driver's available liability coverage
• notifying your insurance company about a potential UIM claim
• documenting your injuries and financial losses
• reviewing the terms and limits of your policy
• evaluating whether additional benefits may be available under applicable state law

Some claims move forward with relatively little disagreement. If the insured and the insurance company disagree about fault, damages, or coverage, the policy may require arbitration or another dispute-resolution process, depending on the policy language and state law. Those issues can affect both the timeline and the outcome of the claim.

Evidence That Can Strengthen an Underinsured Motorist Claim

A UIM claim doesn't begin from scratch. Much of the same evidence used in the original accident claim often becomes important again.

Medical records explain the extent of your injuries. Wage records help document lost income. Police reports and witness statements provide context for how the collision occurred, and photographs preserve details that may no longer exist once the vehicles are repaired or the roadway has been cleared.

Your own insurance documents matter, too. Declarations pages, correspondence with insurance companies, copies of settlement offers, and records showing the at-fault driver's policy limits may all become part of the review.

If you documented the crash scene with photographs or video, preserving the original files can also help maintain a reliable record of the accident.

Challenges That Can Arise During a UIM Claim

An underinsured motorist claim doesn't always become complicated because people disagree about who caused the crash.

Sometimes the discussion centers on the injuries themselves. An insurer may request additional medical records, question whether future treatment is related to the accident, or review whether a preexisting condition contributed to the current symptoms.

Policy language can also become part of the conversation. Coverage limits, exclusions, offsets, and other provisions vary from one policy to another, which is one reason two claims with similar injuries can follow very different paths.

FindLaw notes that insurance disputes frequently involve disagreements over the scope of coverage, the value of damages, and how policy provisions apply to a particular claim – not simply who was at fault for the accident.

Can You Recover Compensation Beyond the At-Fault Driver's Policy Limits?

Many people assume the at-fault driver's insurance policy sets the maximum amount available after a crash. In some situations, there may be additional sources of recovery.

Underinsured motorist coverage is one possibility. Depending on the circumstances, another party may also share responsibility for the accident. A commercial vehicle, an employer, or another driver involved in the collision could have separate insurance coverage that warrants review. Some people also carry umbrella insurance policies that may provide additional protection, though whether those policies apply depends on their specific terms.

Every situation is different, which is why reviewing all available insurance policies often becomes an important part of evaluating a serious injury claim.

Settlement Negotiations in Underinsured Motorist Cases

Receiving an offer for the at-fault driver's policy limits doesn't always mark the end of the claims process.

Before accepting a settlement, it's important to understand how doing so could affect any underinsured motorist benefits that may be available under your own policy. In some states or under some insurance contracts, additional procedural steps (such as notifying your insurer or obtaining consent before finalizing a settlement) may apply.

Underinsured motorist claims arise under your own insurance policy, making the policy language and applicable state law central to how the claim is handled. Reading those provisions carefully before making decisions can help avoid surprises later in the process and prevent headaches down the road.

Common Mistakes to Avoid When Pursuing Underinsured Motorist Benefits

Underinsured motorist claims often involve more moving parts than people expect. A few common mistakes can make the process more difficult.

• Assuming the other driver's insurance is the only coverage available. Your own policy may include benefits you haven't reviewed yet.
• Waiting too long to notify your insurance company. Many policies contain notice requirements, and the timing can vary depending on the policy language and state law.
• Accepting a settlement before reviewing your UIM coverage. Understanding how a settlement may affect additional benefits can be an important part of protecting your rights.
• Overlooking key documentation. Medical records, wage information, policy documents, and correspondence with insurance companies often become important pieces of the claim.

A little preparation early in the process can help prevent unnecessary complications later.

Brandon J. Broderick, Attorney at Law

One insurance policy. Another driver's policy. Medical bills. Settlement paperwork. It's easy to feel like every answer leads to another question.

You don't have to untangle all of it on your own.

If you have questions about an underinsured motorist claim, contact Brandon J. Broderick, Attorney at Law. Whether you're reviewing paperwork late at night or trying to make sense of a call from the insurance company over the weekend, our attorneys are available 24/7 to help answer your questions – contact us today.