UM/UIM Coverage: Protecting Yourself Before an Accident
Car accidents can be life-changing, not just physically and emotionally but financially. One of the more frustrating situations we encounter is when a car crash or drunk driving accident victim in Oregon is unable to receive full compensation for their injuries due to the at-fault driver’s inadequate insurance coverage—or, worse, lack of coverage altogether.
Understanding the Risk: Judgment-Proof Drivers
In personal injury law, “judgment proof” generally refers to individuals who are unable to pay because of a lack of assets or income. While you may win the lawsuit and secure a judgment, a judgment-proof individual lacks the resources to pay that judgment. Many can also file for bankruptcy to avoid paying more than their insurance policy covers.
Most personal injury and wrongful death judgments are dischargeable in bankruptcy under 11 U.S.C. § 727(b), which releases the debtor from liability for most debts after bankruptcy proceedings. However, there are key exceptions, such as:
Judgments arising from drunk driving are nondischargeable under 11 U.S.C. § 523(a)(9). For more information, visit our practice area page on Drunk Driving Accidents.
Judgments based on willful or malicious conduct are also nondischargeable under 11 U.S.C. § 523(a)(6).
This legal reality means that if the at-fault driver is judgment-proof, your recovery may be limited to the policy limits of their motor vehicle liability insurance. In Oregon, the minimum required liability coverage is $25,000 per person and $50,000 per accident under ORS 806.070(2)(a). While this may seem adequate at first glance, even a brief hospital stay these days can exceed $25,000.
The Solution: Uninsured and Underinsured Motorist Coverage
Thankfully, Oregon law mandates that all motor vehicle insurance policies include coverage for both uninsured motorists (UM) and underinsured motorists (UIM). Under ORS 742.502(1):
“Every motor vehicle liability policy issued for delivery in this state that insures against loss resulting from liability...must provide uninsured motorist coverage.”
Additionally, ORS 742.502(2)(a) ensures that UM and UIM policy limits match the bodily injury liability limits unless the insured opts for lower limits in writing. When a car accident victim’s damages exceed the at-fault driver’s liability limits, the victim’s UIM coverage kicks in (up to their coverage limits) to make up for any shortfall.
How It Works: A Practical Example
Let’s break it down with a real-world scenario:
A car accident victim is seriously injured in an auto accident in Portland, Oregon, and their medical bills total $50,000. The at-fault driver has the minimum liability coverage of $25,000. The car accident victim has $25,000 in UM/UIM coverage.
In Oregon, the car accident victim’s UM/UIM coverage is stacked on top of the at-fault driver’s liability limits if the car accident victim’s damages exceed the at-fault driver’s liability limits. This means in the example above, the car accident victim could recover:
$25,000 from the at-fault driver’s liability insurance.
AND an additional $25,000 from their UM/UIM coverage to make up for any shortfall.
Stacking UIM coverage on top of the at-fault driver’s liability limits became possible in 2016 when Oregon updated its insurance laws. ORS 742.502. There can be other issues relating to UIM stacking. For example, if your household has multiple motor vehicle insurance policies, do the UIM limits of those policies stack? Potentially, yes, but there are ways insurance companies try to get around that result. Unfortunately, resolving complex insurance coverage disputes requires carefully reviewing the entire insurance policy and being thoroughly familiar with Oregon insurance law.
A Recent Case: Rogers v. Farmers Ins. Co. (2026)
This last issue—stacking coverage across multiple policies in the same household—was the subject of an important decision issued by the Oregon Court of Appeals in May 2026: Rogers v. Farmers Insurance Company of Oregon, 349 Or App 691 (2026).
In that case, the plaintiff owned two vehicles—a Mazda and a Lexus—each insured under a separate Farmers policy, and each policy included $100,000 in UIM coverage. While driving her Mazda, she suffered serious injuries caused by an underinsured driver. Farmers paid her the $100,000 limit under the Mazda policy but refused to pay the additional UIM coverage available under the Lexus policy. Farmers relied on an exclusion that prohibited stacking when the insured was occupying a vehicle she owned that was not listed under that particular policy.
In a divided 2–1 decision, the Oregon Court of Appeals held that the exclusion was less favorable than the model policy permitted under ORS 742.504 and was therefore unenforceable. The court reasoned that the Mazda qualified as an “insured vehicle” under Oregon law, meaning Farmers could not use the exclusion to prevent the plaintiff from recovering under both policies.
The decision reaffirms an important principle: in Oregon, UM/UIM coverage generally follows the person, not the vehicle—even when that person has separate policies covering different vehicles in the same household. That said, this was a recent and divided decision, so the insurer may seek review by the Oregon Supreme Court. The case illustrates how complex and heavily disputed household-policy stacking claims can become, and why it is so important to consult a lawyer who understands Oregon insurance law before accepting the insurance company’s first answer.
Other UIM stacking issues may arise beyond those addressed in this case. Resolving complicated insurance coverage disputes requires a careful review of the entire policy and a thorough understanding of Oregon insurance law. For that reason, it is important to speak with an experienced Portland uninsured and underinsured motorist lawyer, like me, who can carefully evaluate your situation and determine your rights.
Why UM/UIM Coverage Matters
The aftermath of a car accident is stressful enough without worrying about who will pay for medical bills, lost wages, and other damages. Of course, purchasing higher policy limits costs more money, and in these difficult economic times, we can only do what we can. But doubling or tripling your policy limits may not be as expensive as you think. Check with your insurance company and see what you can afford. That way, if the unthinkable happens, at least you’ll be prepared.
Contact an Experienced UM/UIM Claims Lawyer Today
Grandy Injury Law has extensive experience handling uninsured and underinsured motorist claims and insurance coverage disputes. If you have questions about your insurance policy, your rights under that policy, or the claims process, we’re here to help. Don’t let the insurance companies take advantage of you. Contact our Portland personal injury law firm today for a free consultation and to protect your rights.
Last Updated: 07-16-2026
