How effectively can you explain UM/UIM coverage to a client who doesn’t know much about insurance? In layman’s terms, UM/UIM coverage is insurance that pays for the client’s injuries from an accident caused by the owner or operator of an uninsured or underinsured vehicle. Excess UM/UIM from a personal umbrella policy pays after the auto policy’s UM/UIM limits have been exhausted.

It’s important for a client to understand that UM/UIM coverage comes into play when an insured is involved in an accident and the person who caused it either doesn’t have any insurance or

doesn’t have enough insurance to pay for your client’s injuries. It would also come into play if they were the victim of a hit-and-run (in a vehicle, on a bike, or as a pedestrian), leaving

them with nobody’s insurance policy to collect against…making it an “uninsured” motorist claim.


According to recent estimates by the Insurance Research Council (IRC), roughly 1 on 7 drivers is uninsured. Add to that the number of drivers who carry state minimum auto limits, and it’s enough to make a person want to stay home for good. Unfortunately, this should come as no surprise, given the type of TV commercials we see these days from some auto insurance companies. Too often, the emphasis is on getting a cheap rate, and drivers are besieged with ads about that encourage them to buy “state minimum” auto limits in order to save money. There’s no denying that it can be a temptation in a struggling economy.

All the more reason to make sure your clients are protected from the drivers around them, with UM/UIM coverage on both their auto and personal umbrella policies.


There’s no way around admitting that UM/UIM coverage can be expensive, and a tough sell if a client is trying to keep their premium down. One wise agent explains it to his personal umbrella clients this way. If you’re buying an umbrella so that you can cover the injuries of strangers, wouldn’t you want to do the same for your own family, instead of blindly relying on someone else to cover your injuries…someone who might not.

Real Life Claim Scenario:

Mrs. Policyholder was on her way to work when she was rear-ended on the highway, causing her to run off the road and into a concrete barrier. She sustained multiple internal injuries, including a severely fractured ankle, which led to months of treatment and an infection that required additional hospitalization and more surgery. Unable to work during her recovery, she lost over $100,000 in income while racking up medical bills of over $120,000. She was no longer able to walk long distances or enjoy many of her favorite activities, impacting her life significantly. It was soon discovered that the driver of the other vehicle had state minimum limits of only $10,000 per person/$20,000 per accident. Mrs. Policyholder was paid the full $10,000 available, but the other driver had no other insurance and no assets. Mrs. Policyholder had UM/UIM limits of $250,000 per person/$500,000 per accident under her own auto policy, as well as $1M of UM/UIM coverage under her personal umbrella policy. She was able to recover the amount from her own insurers that she would have been entitled to recover from the other driver, had he carried enough insurance. If she hadn’t purchased UM/UIM coverage, her payment would have been only the $10,000 policy limit of the other driver.

Contact us to learn more about these policies and how to avoid these issues.