Uninsured and underinsured motorist coverage is the same thing. If you are hit by a driver who is uninsured, your insurer must step into their shoes and pay all damages for bodily injuries for which the at-fault person would have owed and paid if they were insured.
Underinsured drivers are drivers who carry inadequate insurance to pay for the harms and losses they caused. After an underinsured motorist’s insurance pays the limits, then coverage for harms and losses applies as if the at-fault driver was uninsured. For example, if the driver’s insurance pays $100,000 and you have $100,000 in uninsured motorist coverage, there is $200,000 available to compensate you for bodily injuries.
Uninsured motorist coverage is very important. If you don’t have it, the insurance company must prove that you were given the opportunity to make a reasonably informed decision to purchase it. If they cannot, then you may have uninsured motorist coverage as if you had purchased it.
Some insurance companies claim that they don’t have to pay uninsured motorist benefits until you settle all of your claims with them. Colorado law currently requires insurers to pay what they know is reasonably owed for uninsured motorist coverage.