Underinsured Motorist Coverage — Colorado
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Colorado Does Not Require Underinsured Motorist Coverage
Colorado law does not mandate uninsured or underinsured motorist coverage on your auto policy. The state requires only liability insurance: $25,000 per person for bodily injury, $50,000 per accident, and $15,000 for property damage. If another driver hits you and lacks insurance—or carries only the minimum—you have no guaranteed protection unless you purchased UM/UIM coverage yourself.
This matters more in Colorado than in many states. According to 2023 data, 19.7% of Colorado motorists drive uninsured. When you insure multiple vehicles on one policy, a single collision with an uninsured or underinsured driver can affect any car and any household member listed on that policy. The coverage decision you make applies to every vehicle you own.
“For households with multiple cars, declining UM/UIM means every vehicle and every driver on the policy goes without protection if an uninsured driver causes a collision.”
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Colorado Uninsured Motorist Rate
Nearly one in five Colorado drivers carries no insurance. When you add underinsured drivers—those carrying only the $25,000 state minimum—the share of inadequately insured motorists rises further, leaving multi-car households exposed if they decline UM/UIM coverage.
Colorado Division of Insurance, 2023
What Underinsured Motorist Coverage Actually Pays
Underinsured motorist coverage pays the difference between what the at-fault driver's liability policy covers and your actual medical bills, lost wages, and injury-related expenses.
Uninsured motorist coverage works the same way but applies when the at-fault driver has no insurance at all. Both coverages protect you and every household member listed on your policy, regardless of which vehicle they were driving or riding in at the time of the collision. For households with multiple cars, this means one UM/UIM policy protects every driver and every vehicle on the same policy.
The coverage does not pay for vehicle damage in Colorado. Property damage from an uninsured driver is covered under your collision coverage if you carry it, subject to your deductible. UM/UIM in Colorado is bodily-injury protection only.
If you decline UM/UIM coverage, Colorado law requires you to reject it in writing. Carriers will not let you skip this step—you must sign the rejection form to finalize your policy.
Why Multi-Car Households Face Greater Exposure
A household with multiple vehicles puts more drivers on the road more often. Each trip increases the statistical chance of a collision with an uninsured or underinsured driver. When you insure two, three, or four cars on one policy, you are not just protecting the vehicles—you are protecting every person who drives or rides in them.
Colorado's $25,000 per-person liability minimum has not changed in decades. Medical costs for serious injuries routinely exceed that amount. A broken bone, surgery, or extended hospital stay can generate bills well above $25,000. If the at-fault driver carries only the minimum and you declined UM/UIM, you pay the difference out of pocket or through your health insurance, which may not cover all injury-related expenses such as lost wages or rehabilitation.
Carriers typically offer UM/UIM at the same limits as your liability coverage. For households with multiple cars, this provides a single layer of protection that follows every driver and every vehicle on the policy, regardless of who was driving at the time of the collision.
$25,000
Colorado Minimum Bodily Injury Per Person
Colorado's minimum liability limit per person is $25,000. Many drivers carry only this amount. A single emergency-room visit and follow-up care for a moderate injury can exceed this threshold, leaving you to cover the shortfall if you declined underinsured motorist coverage.
Colorado Revised Statutes, motor vehicle financial responsibility law
How UM/UIM Fits Into a Multi-Car Policy Structure
When you add underinsured motorist coverage to a multi-car policy, the premium increase is typically modest compared to the liability and collision premiums you already pay. The coverage is priced per policy, not per vehicle, so insuring three cars under one policy with UM/UIM costs less than insuring three cars on separate policies with the same coverage. Combining vehicles on one policy and adding UM/UIM together often produces a lower total premium than splitting the cars across multiple policies without it.
Carriers writing multi-car policies in Colorado include State Farm, Geico, Progressive, Farmers, Allstate, Liberty Mutual, Nationwide, USAA, Travelers, American Family, and others. Not all carriers price UM/UIM the same way. Some apply the multi-car discount to the entire premium including UM/UIM; others calculate it separately. When you compare quotes, confirm that each quote either includes or excludes UM/UIM so you are comparing equivalent coverage across carriers.
Compare Carriers That Write Multi-Car Policies With UM/UIM
If you insure multiple vehicles and want underinsured motorist protection, request quotes that include UM/UIM at the same limits as your liability coverage. Provide each carrier with the same household information: the number of vehicles, the drivers on the policy, and the coverage limits you want. The quotes you receive will show the total premium for the policy including UM/UIM, and you can compare the cost of adding that protection across carriers.
Colorado does not require UM/UIM, but the written rejection requirement ensures you make an informed choice. For households with multiple cars, declining the coverage means every vehicle and every driver on the policy goes without protection if an uninsured or underinsured driver causes a collision. Compare the cost of adding UM/UIM to the risk of paying injury expenses out of pocket when the at-fault driver's liability limit falls short.
How the Written Rejection Requirement Works
When you apply for coverage or renew your policy, your carrier will present a rejection form if you choose not to purchase UM/UIM. The form states that you understand the coverage protects you from uninsured and underinsured drivers, that Colorado does not require it, and that you are declining it voluntarily. You must sign and date the form. Without your signature, the carrier cannot finalize a policy that omits UM/UIM coverage.
For multi-car households, the rejection applies to the entire policy. If you insure three vehicles and decline UM/UIM, none of those vehicles—and none of the drivers listed on the policy—will have underinsured motorist protection. You cannot reject coverage for one vehicle and accept it for another on the same policy. The decision is policy-wide, and it affects every household member and every car you insure together.
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Get My Colorado Car Insurance QuoteFrequently Asked Questions
Does Colorado require uninsured motorist coverage?
No. Colorado does not require uninsured or underinsured motorist coverage. Carriers must offer it at limits equal to your liability limits, but you can decline it by signing a written rejection form. Without UM/UIM, you have no protection if an uninsured or underinsured driver injures you.
What happens if I decline underinsured motorist coverage in Colorado?
You must sign a written rejection form. The rejection applies to your entire policy, so every vehicle and every driver on that policy will lack UM/UIM protection. If an at-fault driver's liability limit is too low to cover your injury costs, you pay the difference out of pocket or through health insurance.
Does underinsured motorist coverage protect all cars on my policy?
Yes. UM/UIM coverage applies to the policy, not to individual vehicles. If you insure three cars on one policy and purchase UM/UIM, every household member and every vehicle on that policy is protected, regardless of which car was involved in the collision.
How much does underinsured motorist coverage cost in Colorado?
The cost varies by carrier, your liability limits, and the number of vehicles on your policy. UM/UIM is priced per policy, so adding it to a multi-car policy typically costs less per vehicle than adding it to separate single-car policies. Request quotes with and without UM/UIM to compare the difference.
Can I reject UM/UIM for one car and keep it for another?
No. The rejection applies to the entire policy. If you decline underinsured motorist coverage, none of the vehicles or drivers on that policy will have UM/UIM protection. You cannot selectively apply the coverage to individual cars on the same policy.
What is the difference between uninsured and underinsured motorist coverage?
Uninsured motorist coverage pays when the at-fault driver has no insurance. Underinsured motorist coverage pays when the at-fault driver's liability limit is too low to cover your injury costs. Both protect you and your household members listed on the policy, and both are optional in Colorado.