If you’ve been hurt by a reckless driver who had insurance but not enough of it to cover your damages, you can feel stuck in a difficult situation. On the one hand, you’re relieved that the other driver at least had insurance. On the other hand, you’ve still got to deal with the frustration that their policy isn’t going to come anywhere near covering the cost of your medical bills, lost wages, and all the other related expenses the crash has piled on you. That gap has a specific name in Illinois: underinsured motorist or UIM coverage. Luckily, an experienced underinsured motorist attorney in Illinois can help you through the often complex claims process.
That’s why the underinsured motorist accident lawyers here at Lerner and Rowe have prepared this handy guide.
Uninsured vs Underinsured: Two Types of Coverage, One Statute
Illinois handles uninsured and underinsured motorist protection under two related parts of the Illinois Insurance Code.
Illinois UIM law 215 ILCS 5/143a requires that every car liability policy issued in the state come with uninsured motorist (UM) coverage. This kicks in when the driver who caused the crash has no insurance or engaged in a hit-and-run.
Section 143a requires minimum UM coverage, while Section 143a-2 governs additional UM coverage and underinsured motorist coverage. Many Illinois drivers carry UIM coverage because insurers must offer it unless it is rejected as provided by law.
The distinction is important because how you trigger each type of claim is different. UM kicks in when the other party has no coverage. UIM, on the other hand, is for when there is some coverage—but it just isn’t enough.
The Exhaustion Requirement: Why Timing Matters
Illinois law can be pretty tricky about when UIM policies start paying out—and it leaves a lot of people open to surprises. Under the law, UIM policies often contain a clause that says they won’t start paying out until the at-fault driver’s liability coverage has been “exhausted”—either fully or partially paid out. This often catches people off guard in two ways.
First, you can jeopardize your UIM personal injury claim by settling with the at-fault driver’s insurer without giving your own UIM carrier advance written notice. Once you do give notice, your insurer has 30 days to advance you a payment equal to the settlement amount—if they don’t, they give up their right to later recover that money from the at-fault driver or their insurer.
Second, even if the at-fault driver settles for less than their full policy limit, it doesn’t mean their UIM coverage won’t apply. Illinois law is pretty clear on this, but the way you sequence things is still very important.
A lawyer who deals with the UIM claim process in Illinois regularly will know exactly how to handle things here, so nothing gets missed or waived.
Underinsured Motorist Attorney in Illinois: Anti-Stacking Provisions
“UM/UIM stacking in Illinois” is what happens when you combine UM/UIM coverage from more than one vehicle or policy to boost your total available benefits—and in Illinois, courts generally enforce clear anti-stacking provisions.
Under 215 ILCS 5/143a-2, an insurer can limit your total UIM recovery to just the highest applicable limit among your policies—rather than adding them all up. Illinois courts have been debating this for some time, and when a clause is a bit unclear, the policyholder often gets the benefit of the doubt.
Here are a few things that tend to come up in these disputes:
- Whether you paid a separate premium for UM/UIM on each vehicle listed on your policy
- Whether the anti-stacking language is clear that coverage won’t combine
- Whether you’re trying to stack coverage within a single policy (across all the vehicles), or across multiple policies (like yours and a household relative’s, for example)
Don’t just take an adjuster’s word for it either—if they tell you you’re stuck with a single policy limit, you should get your policy reviewed line by line.
The Arbitration Process for UM Disputes – How It Works
When you and your own insurance company can’t see eye to eye about a UM claim—be it liability, damages, or how much you’re owed—Illinois law requires UM arbitration provisions in automobile policies. This process usually involves a three-arbitrator panel for claims within the statutory minimum limits, and Illinois has specific rules allowing certain evidence—medical bills, wage-loss documentation, and repair estimates—to be submitted without live testimony, provided the other side gets at least 60 days’ written notice. For claims above the statutory minimum, arbitration procedures may differ depending on your policy language.
Arbitration can be quicker than dragging it out in the courts, but it’s not always a simple process. You’re still building a case, presenting evidence, and arguing damages to a panel that will decide what your claim is worth. Insurance companies come to these hearings well-prepared, with adjusters and sometimes defense lawyers who make a living fighting out arbitration outcomes. Having your own rep in the room levels the playing field.
Underinsured Motorist Attorney in Illinois: Bad Faith Tactics in UIM Claims
Because a UIM claim is against your own insurance company, the dynamics get flipped on their head. The company you’ve been paying for years wants to pay out as little of your claim as possible.
Some of the tactics we’ve seen in UIM disputes include:
- Lowballing the value of medical treatment or saying that it’s not related to the crash
- Dragging out the claims process
- Playing games with policy language about stacking or exhaustion to dissuade you from making a claim
- Refusing to settle once liability and damages are clear
Illinois law may allow policyholders to seek statutory remedies, including attorney fees and penalties in certain cases involving unreasonable or vexatious claim handling. If your own insurance company is stalling you on a legitimate UIM claim, that’s definitely worth bringing to the attention of an attorney—and while you’re at it, have them take a look at the underlying underinsured driver accident in Cook County claim itself too.
A Note for People Who Live in Indiana or Cross the State Line
If you live in Northwest Indiana or frequently cross the Illinois-Indiana border, it’s worth knowing that the two states handle this very differently.
Indiana is fairly lenient—it doesn’t require drivers to carry UM/UIM coverage at all. Insurers only have to offer it, and you can opt out if you want to. Illinois, on the other hand, makes UM coverage mandatory on every policy. Indiana’s approach to stacking is less rigid than Illinois’s but far more fact-dependent—it’s shaped more by case law than by a clear statutory rule, and whether you can combine coverage across multiple vehicles or policies really depends on your specific policy language—whereas in Illinois, anti-stacking clauses are common and frequently enforced.
Underinsured Motorist Attorney in Illinois Frequently Asked Questions
How do I know if the at-fault driver was underinsured as opposed to just uninsured?
If the driver at fault has an active insurance policy, but their bodily injury liability limits are lower than your actual damages, they are under-insured—not uninsured. Your insurer will typically want to see some paperwork—that is, documentation of the at-fault driver’s policy limits—before evaluating a UIM claim, however.
Can I just deal with the at-fault driver’s insurance company on my own?
Yes, but you shouldn’t do that without talking to your own UIM carrier first. Many policies require you to give them advance written notice before you settle so your insurer can protect its subrogation rights. Settling on your own without that notice can jeopardize your UIM claim.
What if my insurance policy has an anti-stacking clause?
It really depends on how the clause is worded. Illinois allows anti-stacking clauses—but only if the language is clear and you know exactly what you’re getting yourself into. If the language is ambiguous or hidden away, you can challenge it and possibly still be able to combine coverage across vehicles or policies.
Do I have to go to some sort of binding arbitration for a UIM dispute?
Illinois law requires arbitration provisions for uninsured motorist disputes, and many policies extend similar procedures to underinsured motorist disputes. The process is still all about presenting evidence and arguing your damages—so preparation really matters.
What should I do if my insurance company is dragging out the claim or denying my UIM claim?
The first thing you should do is start keeping a paper trail—write down claim numbers, dates, and any communication from the adjuster. Unreasonable delay or denial of a valid claim is known as bad faith in Illinois, and an attorney can evaluate if that’s happening in your case.
Call a Trusted Underinsured Motorist Attorney in Illinois Now
Dealing with your own insurance company after a crash can feel like a total betrayal—especially if you’ve been paying your premiums on time for years. If you’ve been hurt by an underinsured driver anywhere in Chicago or the surrounding suburbs, our Chicago car accident lawyers are here to walk you through your policy, your options, and what a fair UIM claim should actually look like.
To get started now, simply give us a call, fill out our convenient online contact form, or use our LiveChat service now.
The information on this blog is for general information purposes only. Nothing herein should be taken as legal advice for any individual case or situation. This information is not intended to create, and receipt or viewing does not constitute, an attorney-client relationship.