UM/UIM Insurance in Illinois

A car drifts into your lane and causes you to swerve into a guardrail. The driver keeps going without ever touching you.

In Illinois, that driver might as well have not even existed.

Illinois requires every policy to carry uninsured motorist coverage. It sounds like a guarantee until you see what the courts have done with the phrase “hit and run.” There’s a second surprise: a UM or UIM claim runs against your own insurance company. Now the carrier you’ve paid for fifteen years practically turns against you. If you’re working through a car accident claim involving an uninsured or underinsured driver, this switch is probably something nobody warned you about.

Here’s how UM/UIM insurance in Illinois actually works and where these claims can go wrong.

What Illinois Requires You to Carry

Every auto liability policy issued in Illinois must include uninsured motorist coverage. The Illinois Department of Insurance puts the minimum at $25,000 per person and $50,000 per accident. These are the same amounts as the state’s minimum bodily injury liability limits, which run 25/50 with $20,000 for property damage.

Uninsured motorist coverage that Illinois drivers carry applies in a few situations; for example, when the at-fault driver had no insurance, or the driver’s carrier denied coverage or became insolvent, or the driver hit you and fled the scene.

But hit-and-run incidents carry one unfortunate caveat. Illinois courts have construed “hit-and-run” to require physical contact between the involved vehicles. No “hit,” no coverage. This means that if a phantom car runs you off the road, causes a chain reaction, or forces you to swerve into danger, your insurer can shrug it off and deny you coverage—no matter how clearly it caused your crash.

That single exception decides a lot of hit-and-run insurance claim Illinois disputes before anyone even discusses injuries.

If a driver leaves the scene, report it to the police immediately. A prompt report is often a policy condition anyway. A gap between the crash and the police report is the first thing an adjuster will note.

When They Have Insurance and It Still Isn’t Enough

Underinsured motorist coverage handles the more common problem, which is that the other driver was insured, but for an amount that doesn’t come close.

UIM does not stack on top of what you collect from the at-fault driver. It pays the difference between your UIM limits and the other driver’s liability limits, and the state’s own definition says exactly that. So, if you carry $100,000 in UIM and collect the at-fault driver’s $25,000, then your claim is worth up to $75,000. Not $100,000.

This means buying UIM equal to the state minimum does nothing for you. If your limits and the at-fault driver’s limits are both 25/50, the difference is zero.

Illinois also ties the two together: Buy UM above the statutory minimum, and the law requires you to carry UIM as well.

Unfortunately, the underinsured motorist claim process comes up most often after crashes with serious injuries and after multi-vehicle collisions where one modest policy gets divided among four or five claimants. A $50,000 per-accident limit vanishes fast when three people had to be taken to the hospital.

Pull your declarations page and look at the UM/UIM line. Most people don’t read theirs until they’ve already been in a wreck.

Filing Against Your Own Company

You’ve faithfully made every premium payment on time. You trusted your insurer to have your back. This is where the relationship changes.

To collect, you must prove the other driver’s negligence and the extent of your damages,  but this time to your own insurer, as if they were a stranger. Now your carrier is writing the check, and that means they have every incentive to value your claim as low as possible.

Here’s what’s working in your favor:

• Give timely written notice to your insurer. Policy deadlines are not the same as statutes of limitation. They’re part of the contract and can be much shorter than the two-year statute of limitations on the underlying injury claim.
• Never settle with the at-fault driver’s carrier without your own company’s written permission. This will end your claim. Even if the at-fault driver only has the state minimum, accepting his limits without approval can destroy your UIM claim altogether by defeating your carrier’s subrogation rights.
• Keep meticulous records just like you would if you were suing. Copies of bills, proof of wage loss, crash report, photos…
• Prepare for arbitration. Illinois UM policies routinely require disputes to be heard by an arbitrator, not a jury. Arbitration provisions in Illinois policies can be mandatory or non-binding based on the language in the policy. This is a very important distinction.

Don’t read the arbitration clause when you have to go to arbitration. Read it now.

Why Your Own Insurer Says No

Adjusters defending first-party claims play by the same rules as adjusters on the other side. They deny the extent of your injuries and bring up preexisting conditions and gaps in treatment. They argue that you are partially at fault. Remember, Illinois follows comparative negligence, which means your recovery is reduced by your percentage of fault and barred if you are more than 50 percent at fault. In hit-and-run claims files, they argue there was never any physical contact.

And then there’s a delay. Delay isn’t really a denial; it’s just a tactic. The phone rings. Your bills pile up. You get frustrated. Suddenly $5,000 doesn’t seem so bad.

None of these are reasons to take the settlement offer. They’re reasons to make your file harder to shut down.

Schweickert Ganassin Krzak Rundio, LLP Has Been Doing This in the Illinois Valley for 40 Years

A UM or UIM claim is the strange case where the company you’ve been loyal to becomes the one to whom you have to prove your injuries. Nothing about the policy language explicitly warns you about this. Most people find out while they’re in the middle of trying to recover.

Schweickert Ganassin Krzak Rundio, LLP has represented injured people across North Central Illinois for more than four decades, with over 120 years of combined experience among its attorneys and hundreds of millions recovered for clients. Our lawyers work these claims from Peru, Ottawa, Morris, LaSalle, and Chicago. We know how insurers build a file against their own policyholders because we regularly take those files apart.

If an uninsured or underinsured driver hurt you, contact an attorney before you sign a release or accept a settlement. Your coverage was already paid for. Collecting on it is the fight.