Underinsured Motorist Claims in Arizona: When Their Insurance Is Not Enough

By Joe Styler, Editor, not an attorney · Sources checked October 18, 2026

Short answer: an underinsured motorist claim is a claim against your own auto policy when the driver who hit you had insurance, but the limits are too low to cover your injuries. Arizona law defines underinsured motorist (UIM) coverage as paying the difference between the at-fault driver’s total liability limits and your total damages, up to the UIM limits you bought. If you were hurt in a Flagstaff crash and the other driver carried the state minimum of $25,000, this is the coverage that can decide whether your medical bills get paid.

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Underinsured is not the same as uninsured

Arizona treats these as two separate coverages that apply to different situations. A.R.S. § 20-259.01(H) says so in plain terms. The difference matters because it decides which part of your policy you claim against.

• Uninsured motorist (UM) coverage applies when the vehicle that caused your injury had no liability policy meeting Arizona’s minimum limits, or when its insurer is insolvent. A hit-and-run driver who is never found is handled under UM. Our hit-and-run guide covers that situation.
• Underinsured motorist (UIM) coverage applies when the at-fault driver was insured, but the total of every liability policy that applies is less than your total damages for bodily injury. UIM pays the gap, up to your UIM limit.

So if a driver with a $25,000 policy causes a crash on Milton Road and your injuries come to $90,000, the $65,000 gap is where UIM comes in. How much of that gap gets paid depends on the UIM limit on your declarations page.

Why the gap shows up so fast in Arizona

Arizona’s minimum liability limits, set by A.R.S. § 28-4009 for policies issued or renewed since July 1, 2020, are $25,000 for injury to one person and $50,000 for everyone hurt in one crash. That is the floor the law requires, not what a serious injury costs. An ambulance ride from I-40, an emergency room visit at a Flagstaff hospital, imaging and a few months of physical therapy can pass $25,000 before lost wages are counted.

When the other driver carries only the minimum, their insurer can pay its full $25,000 and still leave you short. That is the exact situation UIM was written for.

Do you have UIM coverage?

Arizona does not require drivers to buy UIM, but it does require insurers to offer it. Under A.R.S. § 20-259.01(B), every insurer selling auto liability policies must offer UIM in writing on a form approved by the state, in limits up to your bodily injury liability limits. The law makes your declarations page the final word on what you chose.

To check, open your declarations page (the one or two page summary your insurer sends at each renewal) and look for “underinsured motorist” or “UIM” with a dollar figure. If the line is missing or says “rejected,” you may not have it. If you can’t find the page, your insurer must give you a copy. UIM coverage under the statute covers all persons insured under the policy, which can include family members in your household and passengers, depending on the policy language.

More than one policy in the household

If you have several vehicles insured with UIM, Arizona allows the insurer to limit you to one policy’s UIM coverage for a single crash, as long as you get to pick which one. If the policy does not tell you about that right to choose, the statute requires the insurer to notify you in writing within 30 days after it learns of the crash. Choosing the policy with the highest UIM limit is the obvious move, and it is worth confirming in writing.

How an underinsured motorist claim works, step by step

1. The liability claim comes first. You or your lawyer present the injury claim to the at-fault driver’s insurer and establish what their policy limits are.
2. Notice to your own insurer. Your policy will require you to tell your insurer about a possible UIM claim. Do this early. Waiting until the other insurer offers its limits can create problems under some policies.
3. Settling with the at-fault driver. Auto policies can contain terms about settling with the other driver without your insurer’s consent. Read yours before you sign any release from the other insurer, because signing the wrong release can affect your UIM rights.
4. The UIM claim itself. Your own insurer evaluates the damages above the at-fault driver’s limits. It is your company, but on this claim it is on the other side of the table, so expect the same scrutiny of medical records and fault that you would get from the other driver’s carrier.
5. Resolution. UIM claims resolve by agreement, or by arbitration or a lawsuit, depending on what the policy says.

What to do this week

• Get your declarations page for every vehicle policy in your household. Note the UM and UIM limits.
• Get the crash report and the other driver’s insurance details. Our guide to getting a Flagstaff accident report explains which agency has it.
• Report the crash to your own insurer and say in writing that you may have an underinsured motorist claim.
• Do not sign a release from the at-fault driver’s insurer until you understand how it affects your UIM claim.
• Keep every medical bill and record. UIM is about the size of the gap, and the gap is proven with paperwork.
• Be careful with recorded statements. Our page on dealing with the insurance adjuster applies to your own company on a UIM claim too.

Fault still matters on a UIM claim

Arizona uses pure comparative fault under A.R.S. § 12-2505. If you were partly at fault, your damages are reduced by your share, and that reduction applies when your insurer measures the gap. Our page on being partly at fault in an Arizona crash explains how that math works.

When the at-fault driver dies or several people are hurt

In a crash with several injured people, the at-fault driver’s per-accident limit ($50,000 at the state minimum) is split among everyone, which can leave each person with far less than the per-person limit. That makes UIM more important, not less. In a fatal crash, the family’s wrongful death claim can also involve UIM. Our fatal crash guide covers who can bring that claim.

Frequently asked questions

What is an underinsured motorist claim?

It is a claim against your own auto policy when the driver who caused the crash had insurance, but their liability limits are less than your injury damages. Arizona law says UIM pays the difference, up to the UIM limit on your policy.

Will my rates go up if I use my UIM coverage?

Rating rules vary by insurer and by who was at fault. A UIM claim arises from a crash someone else caused, but you should ask your insurer directly how it treats not-at-fault claims rather than assume either way.

How long do I have to make a UIM claim in Arizona?

The lawsuit deadline against the at-fault driver is generally two years under A.R.S. 12-542. Your UIM claim also has notice and time rules in your policy, which can be different. Read the policy now and give your insurer written notice early.

Do I have UIM if I never asked for it?

Maybe not. Arizona requires insurers to offer it in writing, but you can reject it. Your declarations page is the final record of what you chose, so check it for an underinsured motorist line and a dollar limit.

Can I collect UIM if I was a passenger?

The answer turns on policy language. Arizona’s statute says UIM covers all persons insured under the policy, which can include passengers and household members. A passenger may also have UIM under their own policy at home.

Should I accept the other driver’s policy limits?

A limits offer can be the right outcome, but your policy may have rules about settling without your insurer’s consent. Check those rules before signing anything, because the wrong release can affect your UIM claim.

Related guides

• Flagstaff motor vehicle accident lawyer: the full guide
• Hit-and-run crashes and uninsured motorist claims
• What is my car accident claim worth?
• Who pays the medical bills after a crash
• Arizona car accident deadlines

Their policy ran out? Free and confidential

If the other driver’s insurance won’t cover your injuries, talk to a lawyer before you sign a release. We’ll connect you with an independent licensed Arizona attorney who handles Coconino County crash claims.