Uninsured and underinsured motorist

The two halves

• Uninsured motorist (UM). The at-fault driver has no insurance at all — or cannot be identified, which is what covers a hit-and-run at most carriers.
• Underinsured motorist (UIM). The at-fault driver has insurance, but their limit does not cover the bill. Yours pays the gap up to your own limit.

They are usually quoted together and often written as one line on the policy.

Why both states make you refuse it in writing

Texas and New Mexico both require carriers to offer uninsured-motorist coverage, and both require your rejection of it to be documented in writing. A legislature does not add a paperwork requirement to a coverage nobody needs.

If you do not remember rejecting it, check your declarations page. It is one of the most commonly dropped lines on a quote shopped purely on price.

Property damage as well as injury

UM is usually split the same way liability is — bodily injury and property damage — and the property side is what repairs your car when an uninsured driver hits it and disappears.

In some cases UM property damage carries its own small deductible. That is still better than the alternative, which is your collision deductible or nothing at all.

Where to set the limit

A sensible default is to match your liability limits. You are insuring against the same size of accident either way; the only difference is which side had the insurance.

You cannot normally carry more UM than you carry liability, which is another reason the liability number matters more than it looks.

Why it matters more here than in a lot of places

Both Texas and New Mexico sit well above the national average for the share of drivers on the road with no insurance at all. That is the whole argument for this coverage, and it is the reason an agent here will push back when somebody wants to drop it.