What Happens When the At-Fault Party is Uninsured/Underinsured?

What Happens When the At-Fault Party is Uninsured/Underinsured?

Insurance is a necessity these days because you never know what’s waiting for you around the corner. One major accident is all it takes for someone to drown in debt.

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You ideally don’t want this to happen. Even if you end up with a lot of expenses, you’ll need some means to get back the money you lost unfairly. A car accident claim is one way to achieve that.

Contacting Michigan Injury Lawyers or other reputable law firms is one way to get fair compensation for your losses and damages. But the path to compensation is riddled with obstacles. And one such obstacle is an uninsured or underinsured driver hitting you.

Uninsured: Meaning

Just as the name suggests, uninsured means that the driver who hit you doesn’t have valid insurance. There is a statistic from the Insurance Research Council that says 1 in 8 motorists are uninsured. Seeking compensation gets a bit tricky if the at-fault party doesn’t have insurance.

Underinsured: Meaning

Underinsured is often used synonymously with uninsured, but they’re not the same. Underinsured is when the at-fault party doesn’t have sufficient insurance to pay for the damages they caused in the car accident.

For instance, if the at-fault party caused $40,000 worth of damages and their insurance covers only $30,000, then you have an underinsured claim at play.

What to do: Uninsured Claims

When the at-fault party doesn’t have insurance, the uninsured motorist coverage pays for the damages.

Uninsured motorist coverage (UM) is only used when a driver causes an accident and doesn’t have valid insurance. The insurance company of the at-fault driver is the one that pays for the victim’s damages. The lack of an insurance company means that the victim may not receive compensation.

UM is pretty handy in such situations. In addition to compensating for drivers without valid insurance, UM also applies to

  • A hit-and-run driver
  • When an insurance company refuses to provide compensation or goes out of business

If the accident happened in a no-fault state, you can expect your insurance to cover the damages.

In states without mandatory no-fault rules, you have the option to purchase personal injury protection (PIP) or medical payments (MedPay) coverage. They will help cover your losses and damages.

What to do: Underinsured Claims

Underinsured claims are handled through underinsured motorist coverage. This covers the remaining amount, which is not covered by the at-fault driver’s liability insurance.

Although the limit of the at-fault driver’s insurance is easy to find, your losses are not. You may not know the duration required for an injury to heal or the additional treatment required. This makes calculating compensation a bit tricky, which a lawyer can easily handle.

Damages Covered

Although both have different names, the losses covered are the same for both insurance coverages. They are listed below.

  • Medical Expenses: Car accident victims suffer a range of injuries, from minor cuts and bruises to traumatic brain injuries. The costs incurred to treat these conditions are covered under medical expenses.
  • Future Medical Expenses: Even after recovery, victims may have to visit a therapist or take medications for extended periods. The money spent for medication, therapy, and other post-recovery medical expenses is covered here.
  • Lost Wages: Severe car accident injuries force victims to miss work. The wages the victim misses due to the car accident are compensated using lost wages.
  • Pain and Suffering: Some car accident victims experience pain after surgery or treatment. This pain will affect their ability to function normally. The amount spent to treat physical pain is compensated through pain and suffering.
  • Funeral Expenses: This is applicable in scenarios where victims lose their lives. Surviving family members can request the funeral and burial expenses of the victim as compensation.


A car accident is a nightmare. The only thing that worsens this nightmare is when you find out that the at-fault driver doesn’t have insurance or has insufficient insurance. In times like this, seeking compensation can be difficult.

A lawyer is great in situations like this. They provide all the legal assistance you need to get the compensation you deserve.


I'm a technology content writer with a solid track record, boasting over five years of experience in the dynamic field of content marketing. Over the course of my career, I've collaborated with a diverse array of companies, producing a wide spectrum of articles that span industries, ranging from news pieces to technical deep dives.