Uninsured & Underinsured Motorist Coverage

Quick Answer

Uninsured & Underinsured Motorist Coverage

Uninsured motorist (UM) and underinsured motorist (UIM) coverage protects your drivers and passengers when an at-fault driver carries no insurance or insufficient limits to cover the damages — a critical gap for passenger-carrying commercial vehicles.

Why UM/UIM Matters for Commercial Passenger Vehicles

Roughly 1 in 8 drivers nationally carries no insurance, and many more carry only state-minimum limits. When one of these drivers causes an accident involving your limo, taxi, or NEMT vehicle, UM/UIM coverage pays for your driver's and passengers' injuries that the at-fault driver can't cover.

State Requirements for UM/UIM Coverage

Many states require UM/UIM coverage on commercial auto policies by default, with limits matching your liability limits unless rejected in writing. Some states (including New York and New Jersey) mandate UM coverage on all for-hire vehicles regardless of the policyholder's preference.

UM/UIM and Passenger Injury Claims

Because commercial passenger vehicles carry paying riders, a single at-fault accident with an uninsured driver can generate multiple injury claims. Adequate UM/UIM limits — typically matching your

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M–$5M liability limit — prevent a coverage gap from becoming an out-of-pocket loss for your business.

Frequently Asked Questions

Is uninsured motorist coverage required on commercial auto policies?

It varies by state. Many states require insurers to offer UM/UIM at limits matching your liability coverage unless you reject it in writing; a few states mandate it outright for for-hire vehicles.

What's the difference between uninsured and underinsured motorist coverage?

Uninsured motorist coverage applies when the at-fault driver has no insurance at all. Underinsured motorist coverage applies when the at-fault driver has insurance, but not enough to cover the full damages.

Does UM/UIM cover my passengers?

Yes. UM/UIM coverage extends to injured passengers in your vehicle at the time of the accident, in addition to your driver, which is especially important for taxi, limo, and NEMT operators carrying paying riders.

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