CAIA Uninsured and Underinsured Motorist Claims

Question 1

When an insured is injured by a hit-and-run driver, under which coverage would they typically file a claim with their own insurer?

Accepted Answer

Uninsured motorist (UM) coverage

Answer

Uninsured motorist coverage applies when the at-fault driver is unknown (hit-and-run) or lacks liability insurance, allowing the insured to recover from their own carrier.

Question 2

What is the primary difference between Uninsured Motorist (UM) and Underinsured Motorist (UIM) coverage?

Accepted Answer

UM applies when the at-fault driver has no liability insurance; UIM applies when the at-fault driver's limits are insufficient to cover damages

Answer

UM coverage responds when the tortfeasor carries no liability insurance, while UIM coverage responds when the tortfeasor's liability limits are inadequate to fully compensate the claimant's damages.

Question 3

In most states, before an insured can collect UIM benefits, they must first:

Accepted Answer

Exhaust or settle the at-fault driver's liability policy limits

Answer

UIM coverage is triggered only after the tortfeasor's liability limits have been exhausted, because UIM is designed to fill the gap between those limits and the insured's actual damages.

Question 4

An insured has UIM limits of $100,000. The at-fault driver had liability limits of $25,000 which were paid in full. The insured's total damages are $80,000. How much can the insured recover from their UIM coverage (assuming an offset state)?

Accepted Answer

$55,000

Answer

In an offset (or reduction) state, the UIM benefit is reduced by the liability amount received, so $80,000 damages minus $25,000 received = $55,000 UIM payment.

Question 5

Which of the following is a typical requirement before an insured settles with a third-party liability insurer for less than the full claim value in a UIM case?

Accepted Answer

The insured must notify and obtain consent from their own UIM insurer

Answer

Most UIM policies require the insured to obtain the carrier's consent before settling with the at-fault driver's insurer to protect the UIM carrier's subrogation rights.

(CAIA) Certified Automotive Insurance Adjuster Practice Test

(CAIA) Certified Automotive Insurance Adjuster Practice Test

CAIA Uninsured and Underinsured Motorist Claims