Uninsured and Underinsured Drivers in Arizona Car Accidents

Arizona law requires drivers to carry liability insurance, with minimum limits of $25,000 per person and $50,000 per accident for bodily injury, plus $15,000 for property damage. In practice, though, plenty of drivers on Arizona roads carry no insurance at all, or carry only the minimums, which can be exhausted quickly by a serious car accident.

An uninsured driver is exactly what it sounds like: someone with no liability coverage. An underinsured driver has coverage, but not enough to pay for the full extent of the harm caused. Both situations create the same basic problem for the injured person: the at-fault driver's insurance cannot fully cover medical bills, lost income, and other losses.

This is where uninsured and underinsured motorist coverage comes in. UM and UIM are optional coverages that Arizona drivers can add to their own auto policies. When the at-fault driver lacks adequate insurance, the injured person's own UM or UIM coverage can step in up to the policy's limits. Many people do not realize they carry this coverage until a crash forces them to look closely at their policy declarations page.

Claims involving uninsured drivers work differently from standard third-party claims. Instead of negotiating with the other driver's insurer, the injured person files a claim with their own insurance company. That can feel strange, since it is the same company that collects their premiums, but the contractual relationship is different: the insurer evaluates the claim under the UM or UIM provisions of the policy, and disputes over the value of the claim can still arise.

Underinsured claims add another layer. Typically the at-fault driver's policy pays first, up to its limits, and then the victim's UIM coverage may cover the remainder up to its own limits. The math of stacking these coverages, along with any offsets the policy allows, is one of the more technical parts of Arizona auto insurance.

Because minimum limits are low relative to the cost of serious medical care, even a crash with an insured driver can turn into an underinsured situation.

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This article is general information, not legal advice. It does not create an attorney-client relationship.