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About one in five California drivers is uninsured, and many more carry only the minimum. Aaron Bollinger explains UM and UIM coverage, how to check for a signed rejection, how your limits affect an umbrella policy, and a two-line check you can do today.
If one in five California drivers has no auto insurance, what pays when one of them hits you? The answer is a single coverage on your own policy: uninsured and underinsured motorist coverage.
Aaron Bollinger of Bollinsure Insurance Services explains California's minimum limits and the scheduled increase, how UM and UIM pay for medical bills, lost wages, pain and suffering and hit-and-runs, why umbrella insurers look at your underlying limits, and the two lines to check on your policy today.
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Clarifications
Get quoted: Check your auto and umbrella limits with Bollinsure Insurance Services at www.bollinsure.com/quote, or call 562-268-9355.
CA License 6013787
This episode is for general education only and is not legal, tax, or coverage advice. Coverage, eligibility, and pricing depend on the carrier, underwriting, and your policy terms.
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Insurance, explained clearly by a family with three generations of expertise. Speaking of Insurance from Bollinsure Insurance Services features California insurance conversations with Brian Bollinger and Aaron Bollinger, covering home, auto, business and personal umbrella topics. Find episode transcripts and related resources at https://www.bollinsure.com/podcast.
Aaron Bollinger (00:00)
If you think the worst thing about driving in California is the traffic, then I'm 100% agreeing with you. I would say the second worst, and it's a close second though, is the fact that one in five drivers in California don't have auto insurance. And the ones that do, a lot of them carry what we call the minimum auto insurance liability limits. That went up in 2025, effective January 1st, to $30,000, $60,000, $15,000. We're going to talk about what those limits mean. But today, the emphasis is going to be on what that one coverage is on your auto insurance policy that pays you when the other driver can't or their insurance can't.
Aaron Bollinger (00:37)
This is the Speaking of Insurance podcast brought to you by Bollinger Insurance Services. My name is Aaron Bollinger. And this podcast is a part of our family agency's way of attempting to bridge the gap that has historically been there for insurance knowledge. People are using a lot of AI nowadays to guide them, which is 100% beneficial because AI is one of the smartest things in all of human history. But I think what it doesn't have is real human experience. And so I'm attempting to bring three generations of insurance knowledge insights that my family has given me to you guys through this, some of the time with my father, Brian Bollinger, as a podcast companion, but not today. But let's talk about the numbers. So what does it mean that about 20% of California drivers are uninsured. And where's that from? That's from an IRC study in 2025. And so this is just saying that literally one in every five cars that you see on the street, if you're listening to this in your car, odds are if you're in a five lane row, one of those is underinsured or uninsured.
Aaron Bollinger (01:38)
Sorry. That's scary, right? And so if they were to hit you, what happens? They've either got to pay out of pocket or they're not going to pay anything. So what does that mean for you? That means that you would get in all likelihood, one fifth of the time, nothing from their insurance company and be on your insurance company to pay for your medical expenses. I'll be on your insurance company to pay for your passengers, medical expenses, and the emergency care that they would have to do and the repairs to your car in the event that they literally can't.
Aaron Bollinger (02:05)
Now, of course, your insurance company is going to go after that person and try and go get the money back, but hit and runs are serious. People do get away with these types of things, and that's what we're going to be talking about. But there's awesome news, guys. In 2035, In 2035, the minimum limits are going to be increasing to $5,125 from 30, 60, 15. So those numbers in order, it's like, think of it this way. It's like a 50 and then a slash and then 100 and then a slash and then 25. And so those are in the thousands. And so it's $50,000 per person that would be covered in 2035, 100,000, sorry, per accident, and then $25,000 for the property damage side. That's awesome, right? That sounds like great news. So we just have to wait nine years and increase our underinsured and uninsured motorist insurance coverages on our auto insurance to accommodate for that change. But what about the people who are driving uninsured? What about people who are driving underinsured who get into an accident with you and their insurance literally is just the minimum. And so you have $300,000 in medical expenses, but their liability limit only goes up to $60,000. There's $240,000 there of medical expenses for you and your family and
Aaron Bollinger (03:09)
your passengers. That's what makes this so serious and so important. It's the fact that for some reason, our state has a plethora, has a excessive amount of people who are not adequately insured to help pay for and pay for the medical expenses of the people that they would injure in the event that they do get into an auto accident. So we're going to be talking about literally there's just one insurance policy coverage. It has those, it has two numbers. It's not the primary ones. The primary ones matter for the person that you get into the accident with. If it's zero, that means they're uninsured. If it's the 30, 60, 15, then that means they're underinsured. And what your policy is going to have, hopefully by the end of this podcast, is it's going to have a $250,000 per person, $500,000 per accident, underinsured, uninsured motorist coverage. So let's talk about the difference between those two first. What is uninsured? Uninsured is scary, is what it is.
Aaron Bollinger (04:07)
It just means that the other person that you get into the accident with does not have insurance. underinsured, some of the time can be scarier because somebody hasn't been properly... I mean, obviously, paying for insurance is tough. People get it. I get it. I think it's one of the most effective decisions that you can make in terms of protecting your financial assets. But if somebody has allowed you to write a 30-60-15 policy that is an insurance broker, run. Obviously, I wouldn't doubt the professionalism, but it is not an ideal insurance limit under maybe the worst of circumstances or very, very hard financial times, of course, things like that can be ways to save money. But if you get into one accident and I tell you one accident, then your entire livelihood is ruined because people get injured and it adds up to minimum hundreds of thousands of dollars.
Aaron Bollinger (04:55)
So again, to those of you who are underinsured or uninsured, please go up that coverage. We are more than happy as a family-run agency to give you guys cost-effective options that do have better insurance limits. But this coverage that you can add to your insurance policy, UM and UIM, that's just short for underinsured motorist, uninsured motorist coverage can pay for the medical bills, the lost wages, the pain and suffering that you get and hit and runs too.
Aaron Bollinger (05:21)
So this is a very cost-effective way to just add it to your insurance policy and make sure that in the event that somebody does not have the adequate insurance or any insurance to pay for you and your medical bills, to pay for you and your lost wages, to pay for you and your loss of pain and suffering as well. It makes it so you don't have to pay that out of pocket and you don't have to go scrambling. It's just the insurance company that does the job for you, which I'm a big advocate for because I mean, if you're paying your insurance premium already and you do have good limits, then you might as well have this insurance coverage as well. And if you're not having this insurance coverage, then you should definitely add it and go get good limits. That makes sense. But rejecting it, there is a way that you can reject uninsured, underinsured motorist coverage. People sign it away to save money. It takes a signed waiver. Check your declarations page. You could have signed it when you first signed up. It could be somebody that's, you know, maybe you're on your parents' auto insurance policy and you're afraid and you're cautious and maybe you're just properly understanding the level of risk that comes with driving in California with these crazy drivers, with these uninsured and underinsured
Aaron Bollinger (06:23)
drivers, and you just want to add it. You can go back. You can go get the policy with the underinsured, uninsured motorist coverage very easily, but the insurance companies are required to make you reject it if you were to opt against it. How this coordinates with umbrella insurance. Those of you who have a great insurance program, you probably have umbrella insurance. Awesome. If you don't have umbrella insurance, go at it. What you're going to have to do is you're going to have to be properly insured on the auto insurance side, though they do not accept underinsured, that is minimum limits, because they're not going to add millions of dollars of coverage to low limits, because then the second that that low limit gets exhausted, which would be very quickly, then they would have to go in and pay for the excessive amount of the additional liability coverage and the additional damages that does happen. So again, if let's say your policy has $60,000 each accident coverage, an umbrella insurance company is not going to be super thrilled because majority of the time that limit is going to get quickly blown through. And then the umbrella insurance company would have to add a million dollars. They would more so like it and be obviously likely to write the insurance policy if it is a $250,000 and $500,000
Aaron Bollinger (07:30)
coverage limit that they're adding it on top of, because then they actually have a blanket, something comfortable that they can say, hey, most of the time this will be covered, but in the worst of circumstances, our umbrella insurance will kick in, which is why it is there. Add it to your umbrella insurance policy, but for that, again, your primary limits, that is those three numbers there have to be on that insurance policy coverage, and it has to be $250,000, $500,000, $100,000 at a minimum. Some insurance companies do require more. Some companies, if you're on a grandfathered insurance policy, do allow you to have $300,000 combined single limit. That is, instead of the $250,000, $500,000, $100,000 to have $300,000 throughout the entire thing. But that is more traditional, and I haven't seen that in a little bit. But if you do, keep it there and add some more insurance to your insurance program. But with that in mind, let's go back to the uninsured UM/UIM. For the umbrella insurance policy, it is required usually that you have the same limits on the primary as you do on the uninsured motorist coverage. Now the uninsured motorist coverage is only two numbers because it's paying for the lost wages, pain, suffering, medical bills, hit and
Aaron Bollinger (08:33)
runs. So those claims, it's two limits on the uninsured motorist coverage. And usually that has to be at the satisfying $250,000, $500,000 coverage limit to add. Usually it's a million dollars of uninsured motorist coverage, which is super cost-effective by the way. Umbrella insurance is crazy cheap. That's why we're big advocates for it. If you do mind your P's and Q's and cross your T's and dot your I's in terms of making sure that the underlying umbrella insurance coverages, the auto insurance and the homeowner's insurance do satisfy it. Let's talk about what is property damage and what is collision coverage, because those are two different things. Uninsured motorist property damage and collision are separate. What fixes your car when the other driver has no insurance? That would be collision coverage. People waive collision coverage because they have a car that might not be super expensive to replace for them. And so it's not worth having that additional premium for the collision coverage for a older car that they wouldn't even want to replace in the first place. Property damage though makes sense. Property. What happens when you hit property? What happens when you hit other things? What happens if you run into a lamppost? Property
Aaron Bollinger (09:38)
damage is a completely separate insurance coverage. Keep that in mind. Bear that in mind. Make sure that your limits are appropriate and satisfying beyond just the minimum limits in California, because those are frankly painful to see. People come through with umbrella insurance requests and they have the minimum underlying limits. And it's a hard conversation to say, your auto insurance isn't satisfying the minimum. And so usually it's quite cost-effective, maybe max double the premium to add, again, hundreds of thousands of dollars to your auto insurance for the event that you do get into an accident. Let's talk about an example though.
Aaron Bollinger (10:13)
If you get rear-ended and there's $85,000 in injuries and the other driver has the $30,000 minimum, without UIM, underinsured motorist coverage, you are short $55,000. But if you were to have, let's say in the worst case scenario, $100,000 of UM/UIM, then you are fully covered up to that. Now that doesn't mean that that $100,000 limit is going to be satisfying of all claims, because again, that's where the umbrella insurance would help satisfy those bigger claims that happen with underinsured and uninsured motorists. But it does mean that you do have a little bit of protection on the side and you're cautious about when you do get into an accident with somebody who majority of the time in California will not have the adequate insurance.
Aaron Bollinger (10:55)
Last point, many umbrellas don't add by default. So ask about it being added. A lot of people, they ask for primary umbrella insurance coverage. What is primary umbrella insurance coverage? A primary umbrella insurance coverage is just coverage that goes over your autos in the traditional accident where it's with another driver who does have proper insurance with a homeowner's claim or a liability claim exceeds your policy threshold or a landlord claim where it's a liability claim and the umbrella insurance can come in and cover you for the excess amount that it costs, assuming that your underlying policies are good. But on the auto side, there's that little UM/UIM coverage on the umbrella insurance, very cost-effective, usually a few hundred dollars to add a million dollars of it. And so hopefully with these statistics, hopefully with the insights about the IRC study in 2025, hopefully with the understanding that a lot of people do cheap out on their insurance. And if you are not one of those people, And if you are listening to a insurance podcast, then hopefully you're not one of those people, or maybe I've convinced you against being one of those people. Either way, I understand, obviously, of course, insurance feels like a waste of money until you need it. And that's
Aaron Bollinger (11:56)
what we are trying to advocate for is that we want you to make sure that your assets, your finances, the things that you have invested so much money and time into, in the event that you do get into a little door ding, in the event that you do get into a catastrophic loss, whatever it may be, that you've got the right insurance program in place. So what do you do? What's the next step from this. Pull up your auto insurance page and find two lines, your liability limits and your uninsured motorist limits. If either one says $30,000, please call us. You can visit our website at Bollinsure.com. You can find more about uninsured motorist coverage at Bollinsure.com as well. We've got a bunch of guides. We've got a bunch of statistics, a bunch of breakdowns.
Aaron Bollinger (12:33)
You can ask ChatGPT about us as well. You can ask ChatGPT, hey, what does Bollinsure say about uninsured motorist coverage? What are the statistics? What numbers do they cite? It can give you some insight, give you some breakdown into the statistics and what we have seen as insurance brokers in California. Thank you so much for listening. Again, err on the side of caution, put the emphasis on the insurance company. With that, this has been the Speaking of Insurance podcast brought to you by Bull Insurance Services, our family agency. I've had a blast talking about how painful it is as an insurance broker to see really low liability limits and people going through serious financial struggles with getting into accidents and then not being able to pay out the claim or vice versa, getting in an accident with somebody who does not have adequate insurance and then their insurance not being able to help them. So please make sure that you call us. Make sure that you go to the website and you ask questions because, again, it's free. Free to ask questions. I'm Aaron Bollinger. Thank you so much for listening.
Aaron Bollinger (13:25)
Hope you guys have a great rest of your week.