In most states, drivers must have automobile liability coverage to pay damages caused by a driver's negligence. Failure to do so can result in fines and denial of registration. According to the Insurance Information Institute study from 2023, nearly one in every seven automobile owners do not have liability insurance on their vehicles. Further, the other driver's liability insurance may not fully compensate a victim for injuries from a crash. The Insurance Information Institute reports that the nationwide average for bodily injury claims in 2022 stood at $24,211.

To afford crash victims some reasonable chance of receiving adequate compensation for injuries, automobile insurance companies offer uninsured and underinsured motorist coverage. The laws on how these coverages work differ by state. Read below to learn about the benefits, requirements, and mechanics of this insurance in California and how to pursue a claim against an uninsured or underinsured motorist in California.

Automobile Liability Coverage

To understand uninsured and underinsured motorist coverage, let's start with a primer on automobile liability insurance. If you get injured by a driver who speeds, is viewing a smartphone, drives drunk, runs a red light, or commits some other careless or unlawful act, you first look to the at-fault vehicle's liability insurance. Automobile liability insurance pays, up to certain limits, the damages that the at-fault driver would be responsible for compensating you because of a judgment by the court or a settlement. These damages typically include:

*Medical expenses to treat and deal with the effects of injuries

*Lost time from work

*Lost or diminished capacity to work or engage in daily activities of life

*Experience pain and suffering, including mental anguish, stress, sleeplessness, headaches, and loss of cognitive function

In California, liability policies must cover at least $15,000 for bodily injuries to one victim and $30,000 for bodily injuries to two or more victims in a wreck. Forbes reports that insurance premiums for the minimum coverage in California average $731.31 per policyholder. For certain low-income drivers with good driving records, California law sets the requirements are $10,000 of bodily injury per person and $20,000 of bodily injury per accident, or occurrence.

Making Claims Under the Uninsured and Underinsured Motorist Policies

Usually, you should know whether the other driver had liability insurance and how much. California Vehicle Code Section 16025 mandates that you and the other driver exchange insurance information at the scene. This means the name and address of the liability insurer and the policy number.

Upon getting that information, you should promptly contact that insurer to make a claim. Knowing whether the other driver gave you the correct insurance information or had coverage in force at the time of the wreck is crucial to your meeting deadlines for your claim. You have two years from the date of the crash to file a lawsuit unless you have settled by that time. Below, we'll discuss deadlines that apply if the other driver is uninsured or underinsured.

Whether you proceed under your uninsured or underinsured motorist coverage, you must at a minimum show that the other driver was at fault in causing the wreck. Note that California uses a pure comparative negligence scheme to consider the effect of the fault of the claimant in causing the crash and injuries. Specifically, the damages you otherwise recover get reduced by the percentage of your fault in causing the crash.

After you cross the threshold of showing the fault of the other driver, you must know whether you must resort to other insurance before you can make a claim under the uninsured or underinsured portions of your policy.

The Underinsured Motorist Coverage

By its nature, underinsured motorist coverage pays when the tortfeasor had liability insurance at the time of the crash but not enough to pay all of a judgment or settlement.

As such, you must first exhaust the negligent driver's liability insurance before you can access benefits through your underinsured coverage. Thus, if your damages amount to $15,000 and the other vehicle had the required minimum liability coverage at the time of the wreck, underinsured coverage will not pay. The same would hold if the driver carried $30,000 for one person and your damages did not go north of $30,000.

As you read above, California follows the comparative negligence rule of reducing a plaintiff's recovery by the percentage for which the plaintiff is at fault. With this rule comes the prospect that you might not indeed exhaust liability coverage or you might barely do so.

For example, a plaintiff with $30,000 in damages but 60 percent at fault would receive $12,000 in compensation ($30,000 x (1-0.60)). If the defendant carried the minimum $15,000 bodily injury per person, the underinsured motorist coverage would contribute nothing because the liability policy limits have not been exhausted. A completely blameless plaintiff with $30,000 in damages would get – after exhausting the liability coverage – $15,000 from the underinsured policy.

The Uninsured Motorist Coverage

The exhaustion rules only come into play if the driver at least had liability coverage at the time of the accident. If the negligent motorist did not have any liability coverage, then you don't have anything to exhaust. Thus, you can proceed right to your uninsured motorist coverage.

In fact, you need to do so promptly. This is because the California uninsured motorist coverage statute gives you two years from the date of the accident to do one of the following:

*File a lawsuit against the uninsured driver

*"Conclude," or complete, an agreement between you and your company as to the amount you are due

*Demand arbitration

By statute, doing one of these things within two years is deemed a prerequisite to suing your automobile insurance for uninsured benefits. The two-year window tracks the statute of limitations of two years from the date of injury in a car accident to file a lawsuit for personal injuries. Usually, the clock begins running from the date of the crash because the victim would in all likelihood suffer some injury at the moment of the crash.

When You Do Not Know the Identity of the Driver

In hit-and-run cases or where you otherwise don't know who hit you, California Vehicle Code Section 11580.2(b)(2) says that the at-fault driver is to be treated as "uninsured." In these cases, you have 24 hours after the crash to report it to:

*The police department of the municipality where the crash occurred; or

*If the crash happened outside of municipal limits, to the sheriff of the county where it happened or to the California Highway Patrol local headquarters

Additionally, you must in writing and under oath tell your uninsured motorist carrier within 30 days after the crash that you have a personal injury claim and that you can't determine the identity of the at-fault driver.

The Limits Uninsured and Underinsured Motorist Coverage

When Your Auto Policy Says it Has Uninsured and Underinsured Motorist Coverage

For automobile policies with express coverage provisions, the limits are those set in the policy. Under California law, the limits must reach at least $15,000 per person and $30,000 per accident if two or more are injured. These limits match the minimum required liability coverage. Your premiums increase as you elect higher coverage limits for uninsured and underinsured motorist coverage.

When the Policy is Silent on Coverage

California law makes uninsured and underinsured motorist coverage part of your automobile policy unless you waive it in writing. In the absence of a waiver, you have this insurance even if the policy doesn't expressly provide it.

In these cases, the limits of uninsured and underinsured equal those of your liability coverage. Again, California requires that you have liability coverage of at least $15,000 per person and $30,000 for two or more injured people in a crash. If you buy just the minimum liability coverage, your uninsured and underinsured coverage has ceilings of $15,000 and $30,000 respectively. If you have higher liability coverage than the minimum required, the uninsured and underinsured limits are the lesser of your liability limits and $30,000 per person or $60,000 per accident.

How to Obtain Uninsured and Underinsured Motorist Coverage

As you have read above, California law makes uninsured and underinsured motorist coverage part of your automobile insurance unless you waive or decline it in writing. Automobile insurers must offer it to you. Forbes magazine says that uninsured motorist coverage averages $136 per year, while underinsured coverage carries an average annual price tag of $90.

Medpay Coverage

"Medical Payments Coverage" (otherwise known as "Medpay") helps you pay bills from the hospital, ambulance, physicians, pharmacy, and other medical providers that arise from a crash. You will not get reimbursement through this for lost wages or pain and suffering.

To access Medpay, you need not prove that the other driver was at fault. As such, this coverage can provide benefits even if an uninsured or underinsured motorist caused the accident.

The minimum Medpay benefits in California stand at $1,000, and the coverage typically runs from $1,000 to $5,000. Medpay is an optional part of your automobile insurance.