Underinsured Motorist Benefits (usually abbreviated UIM) pay you, as the insured, if you were injured as a result of the negligence of another driver who maintained insurance coverage, but with limits of coverage insufficient to compensate you for your injuries. For example, assume the driver at fault maintained an insurance policy with maximum liability limits of $25,000, which was paid to you. Also assume that you were seriously injured and the monetary value of your injuries were $100,000. If you maintained underinsured motorist coverage, your insurance company would pay you additional benefits, up to $75,000 ($100,000 injury value minus $25,000 received from the other insurance company) or the limits of your UIM coverage, whichever is less. Like UM benefits, the insurance company in most states is not permitted to raise your rates, or refuse to renew coverage, merely because it paid UIM benefits.

In Pennsylvania UIM coverage is optional. However, I strongly recommend that you maintain this coverage on your policy. First, there are a large percentage of drivers who maintain insurance with minimum limits of coverage. In Pennsylvania the minimum coverage for liability is $15,000. Therefore, if you are involved in an accident with one of these driver’s, you may receive only $15,000 as compensation for your injuries unless you have UIM coverage. Second, UIM coverage is relatively inexpensive. If you believe you have waived UIM coverage, I strongly recommend that you contact your insurance company and request a quote on the amount it will cost you to maintain UIM coverage in the same amount as your liability coverage.

Stacking is the ability to add together the coverages for UM benefits or UIM benefits if the insurance policy provides for coverage of more than one vehicle. For example, if you have two vehicles insured on your auto policy, and you maintain UM or UIM coverage of $25,000/$50,000, with stacking you would multiply your UM or UIM limits times two (the number of cars on the policy), so that your limits would be $50,000/$100,000. Stacking does not apply to medical payments or liability limits. In Pennsylvania stacking is optional. I strongly recommend that you maintain stacking on your policy. It is a relatively inexpensive way to increase your policy limits.