What does underinsured motorists (UIM) coverage protect an insured against?

Underinsured motorists (UIM) coverage is designed to protect an insured driver when they are involved in an accident with another driver whose insurance coverage is inadequate to cover the damages incurred. This situation typically arises when the at-fault driver's liability limits are less than what the injured party has in damages.

By having UIM coverage, an insured can claim for the difference between the at-fault party's liability limit and their own coverage limits, ensuring that they receive adequate compensation for their injuries and damages. This type of coverage is particularly important in scenarios where the medical expenses, lost wages, or other costs exceed the limits of the at-fault driver's policy.

The other options do not accurately represent the purpose of UIM coverage. For example, uninsured motorist coverage would apply to drivers with no auto liability insurance, while UIM specifically addresses those who do have insurance but not enough. Additionally, liability and fault determinants are separate aspects from UIM, as it focuses solely on the sufficiency of the at-fault driver's coverage. Lastly, drivers using rental cars would typically fall under different coverage considerations and are not addressed by UIM. Therefore, the UIM coverage specifically protects against drivers whose coverage limits are lower than the insured's limits.