Uninsured motorist coverage pays you when the driver who caused your loss has no liability insurance. Underinsured motorist coverage pays you when that driver has insurance but not enough. The Texas Department of Insurance describes the pair as "like buying an extra insurance policy to cover you when the driver who caused the accident didn't have enough insurance," and states that it also applies "if you're in a hit-and-run accident and the other driver can't be found to pay for damages." It is the one place on an auto policy where you make a claim to your own insurer for a loss somebody else caused.
This article explains how a coverage is structured. It is educational information, not financial, insurance or legal advice. For a question about your own policy, speak to a licensed agent or your state Department of Insurance.
Sources checked August 10, 2026. Whether these coverages are required, offered or available at all is set state by state, and the rules change. Your own policy and your state Department of Insurance are the authorities for your contract.
Two words for two different problems
The pair is usually printed as one line item, which hides the fact that they answer different questions.
Uninsured motorist coverage answers: the other driver had nothing. The California Department of Insurance describes uninsured and underinsured motorist coverage as coverage "for a policyholder involved in a collision with a driver who does not have liability insurance," or whose coverage is insufficient.
Underinsured motorist coverage answers: the other driver had a policy, and it ran out. This is the version tied directly to the way liability limits work. Every liability policy has a ceiling, and if the loss is larger than the ceiling, the ceiling is still where the other insurer stops. What that ceiling is and who sets it is covered in what a state minimum auto liability limit actually means.
The hit-and-run case belongs to the first one. The Texas Department of Insurance states that the coverage applies when the other driver "can't be found to pay for damages." A driver who cannot be identified cannot be shown to have had insurance, so the policy treats the situation as an uninsured one. Whether that applies in a given state, and on what conditions, is a state-level question.
It is not one coverage. It is up to four.
This is the structural point that most explanations flatten, and flattening it is what leads people to assume they have something they do not.
The coverage splits on two axes at once. First, uninsured or underinsured. Second, bodily injury or property damage. That produces four possible coverages, and not all four exist in every state or on every policy.
The North Carolina Department of Insurance's own descriptions show the split in practice. It describes uninsured motorist coverage as protecting you when an at-fault uninsured driver injures you or another covered person, including property damage. It describes underinsured motorist coverage as responding when the at-fault driver's limits are too low, and states that underinsured motorist coverage does not cover property damage.
Read those two sentences together. In the same state, under the same department's description, the uninsured version reaches property damage and the underinsured version does not. That is not an error. It is how those coverages are constructed there, and it is exactly the kind of detail that does not travel from one state to another.
The practical consequence is a question rather than a rule: which of the four do you actually carry, and for which of them is there a limit printed on your declarations page? Finding out is a reading exercise, described in how to read an insurance declarations page.
The deductible nobody expects
Here is a mechanical detail that is published by a regulator, that materially changes what a claim costs a household, and that is almost never mentioned in general explanations of this coverage.
Uninsured motorist property damage coverage can carry its own deductible, and it is not necessarily the same as your collision deductible.
The Texas Department of Insurance states that in Texas the deductible for uninsured and underinsured motorist property damage coverage is $250, and notes that this is lower than a typical collision deductible.
Two things follow.
One event can involve two different deductibles depending on which coverage responds. The same damage to the same car can be handled under collision or under uninsured motorist property damage, and the amount the household absorbs first is not automatically identical.
A deductible is a structural feature, not a fee. How deductibles interact with limits, and what the household actually absorbs across a policy, is worked through in premium, deductible, limit, out-of-pocket.
The $250 figure above is Texas's, published by the Texas Department of Insurance in guidance last updated October 14, 2024. It is not a national figure and nothing here suggests it is. The point that travels is that a deductible may apply and may differ; the number itself belongs to a specific state and a specific policy.
Offered, required, or neither
States handle this coverage in more than one way, and the vocabulary matters.
Texas is a documented example of an offer requirement. The Texas Department of Insurance states: "Insurance companies must offer uninsured motorist coverage when you buy auto insurance. If you don't want it, you have to turn it down in writing."
That is not the same as a requirement to carry it. It is a requirement placed on the company, not on the driver. Its practical effect is that in such a state, if you do not have the coverage, there is likely a signed rejection somewhere in your file, which is a document worth knowing exists.
Other states take other approaches, including requiring the coverage outright and setting minimum limits for it. This article names no state's rule except the ones it can attribute, because a rule quoted from the wrong state is worse than no rule at all. Your state Department of Insurance publishes yours.
What it pays for, and why the list is longer than people expect
The Texas Department of Insurance's description of what the coverage pays is unusually specific for a regulator page: vehicle repairs, rental cars, medical bills for you and your passengers, pain and suffering damages, and diminished vehicle value after an accident with an uninsured or underinsured driver.
Two items on that list are worth pausing on.
Passengers. The coverage is not limited to the policyholder. Regulator descriptions in North Carolina and Texas both extend it to other covered persons in the vehicle.
Categories that liability coverage recognizes. Pain and suffering and diminished value are heads of damage that the at-fault driver would have owed. This is the design of the coverage: it steps into the position of the missing insurance rather than functioning like a repair benefit.
And that is also its ceiling. The coverage responds up to the limit written on your own policy. It does not pay whatever the loss turns out to be. Where a vehicle's value caps a payment, the relevant concept is actual cash value, explained in actual cash value versus replacement cost.
How this sits next to your other coverages
An auto policy's main coverages are organized around whose loss it is and what caused it, which is the framework in liability, collision and comprehensive. Uninsured and underinsured motorist coverage does not fit that framework neatly, and that is why it is often overlooked.
It is not liability coverage. Liability points outward, at people you injure.
It is not collision coverage, although in some situations either could respond to the same damage.
It is the coverage that exists because the other driver's contract failed, and it is the only one on the policy whose usefulness depends on somebody else's paperwork.
The honest limitation: this coverage cannot make you whole beyond its own limit, and its limit is one you chose or accepted at some point, often without a conversation. Whether the amount is appropriate for a given household is a question for a licensed agent who can see the policy and the circumstances. This site does not answer it.
What to check on your own declarations page
- Look for UM and UIM as separate line items. They may be printed together or apart.
- Note whether bodily injury and property damage both appear. One may exist without the other.
- Read the limits, and compare them with your liability limits. They are not always the same.
- Look for a deductible on the property damage version specifically.
- If the coverage is absent, ask whether a written rejection is on file and what your state requires.
- Ask how your state treats hit-and-run under this coverage, since the conditions vary.
Your state Department of Insurance publishes the consumer material this article draws on and handles complaints about how a company administers a policy. The National Association of Insurance Commissioners maintains the directory of state departments. A licensed agent in your state can tell you which versions of this coverage are available where you live.
This site explains documents and contracts. It does not tell anyone which coverages to carry, what limits to choose, or which company to buy from. How sources are chosen on this site is set out in our editorial policy.
Frequently asked questions
What is the difference between uninsured and underinsured motorist coverage?
Uninsured motorist coverage responds when the at-fault driver has no liability insurance. Underinsured motorist coverage responds when that driver has insurance but the limits are too low to cover the loss. The California Department of Insurance describes both as coverage for a collision with a driver who has no liability insurance or insufficient coverage.
Does uninsured motorist coverage pay for damage to my car?
Sometimes, and it depends on the state and the version. The North Carolina Department of Insurance describes uninsured motorist coverage as including property damage, and states that underinsured motorist coverage does not cover property damage. Check which versions appear on your own declarations page.
Does this coverage have a deductible?
It can, on the property damage side. The Texas Department of Insurance states that the deductible for uninsured and underinsured motorist property damage in Texas is $250, lower than a typical collision deductible. Deductible rules for this coverage are set by state and by policy form.
Am I covered if the other driver leaves the scene?
The Texas Department of Insurance states that the coverage applies if you are in a hit-and-run accident and the other driver cannot be found. Conditions for hit-and-run claims vary by state, so this is a question to put to your agent or your state Department of Insurance.
Do I have to buy it?
That depends on your state. Some states require it, some require only that the company offer it, and the two are different things. In Texas, the Texas Department of Insurance states that companies must offer the coverage and that a driver who does not want it has to turn it down in writing.
Sources: Texas Department of Insurance, "What is uninsured motorist coverage, and do I really need it?", last updated October 14, 2024, and "Auto insurance guide," last updated December 11, 2025. California Department of Insurance, "Automobile Insurance," Form 101, revised February 5, 2025. North Carolina Department of Insurance, "Basic and Miscellaneous Auto Coverages" (page header carries a July 1, 2025 reference). All accessed and checked August 10, 2026. Every state-specific rule or figure above is attributed to the state that publishes it; no rule here is presented as national.