Arizona UM/UIM Coverage: The Law That Decides Who Pays When the At-Fault Driver Can't

Most drivers assume the person who caused a crash will have insurance that pays for it. Arizona law does not share that assumption — and one statute exists specifically for the moment that assumption fails.

What A.R.S. § 20-259.01 requires

Under A.R.S. § 20-259.01, every insurer writing auto liability policies in Arizona must make available and offer — by written notice — two coverages to every named insured:

• Uninsured motorist (UM) coverage, in limits not less than the policy''s own bodily injury liability limits (subsection A)
• Underinsured motorist (UIM) coverage, in the same manner (subsection B)

The offer must be made on a form approved by the state insurance director. The coverage itself is optional — a policyholder can decline it — but the offer is not. That structure matters: these coverages exist on your policy because the legislature decided every Arizona driver should at least be asked.

UM vs. UIM — two different failures

The two coverages solve two different problems:

UM coverage applies when the at-fault driver has no liability insurance at all — and it is also the coverage typically implicated in hit-and-run situations where the driver is never identified.

UIM coverage applies when the at-fault driver has insurance, but not enough. Under subsection G of the statute, when your damages exceed the at-fault driver''s liability limits, your UIM coverage applies to the difference — up to your UIM limits.

A serious injury can generate damages many times a minimum-limits policy. UIM is the coverage that bridges that gap with your own insurer instead of leaving it uncollectible.

What to check on your own policy

Three things worth confirming on your declarations page today, before any crash:

1. Whether you carry UM and UIM at all. If you don''t, an offer was made and declined at some point — possibly years ago, possibly by a prior household member.
2. Your limits. UM/UIM at minimum limits protects far less than UM/UIM matched to your liability limits, and the premium difference is often modest.
3. Who is covered. The statute requires the coverage to extend to all persons insured under the policy.

Why this matters after a crash

When a crash happens and the at-fault driver can''t pay, UM/UIM stops being an abstraction — it is frequently the primary source of actual recovery. It is also a claim against your own insurer, which involves its own rules, deadlines, and negotiation dynamics. If you''re navigating a serious injury where coverage questions are in play, a licensed Arizona attorney can review the policies involved and identify every coverage that applies.

This is general consumer information about Arizona law, not legal or insurance advice. Policy language controls; review your own policy and consult a licensed professional about your specific situation.