Uninsured motorist coverage rules in Colorado

If the driver who hit you had no insurance, too little insurance, or took off before you got a plate number, your own auto policy is often what stands between you and the medical bills. Colorado treats that coverage seriously. State law makes every insurer put uninsured and underinsured motorist coverage in front of you, and the rules for how it pays are different from what you may have heard in other states.

Here is what actually governs an uninsured or underinsured motorist (UM/UIM) claim in Colorado.

What your insurer has to offer

Colorado doesn't force you to buy UM/UIM coverage, but it forces the insurer to include it. Under C.R.S. 10-4-609, no auto liability policy issued in the state can leave out uninsured motorist coverage unless the named insured rejects it in writing.¹ The insurer also has to offer you UM/UIM limits equal to your bodily injury liability limits, again unless you sign a written waiver for something lower.¹ So if you carry the state minimum of 25,000 dollars per person and 50,000 dollars per accident in liability coverage, your insurer must offer you the same 25/50 in UM/UIM.¹²

Those liability minimums come from C.R.S. 10-4-620: 25,000 dollars for injury or death to one person, 50,000 dollars per accident, and 15,000 dollars for property damage.² Because your UM/UIM offer tracks those numbers, the floor for most drivers is 25/50 unless they buy up.

A separate rule covers early medical bills. C.R.S. 10-4-635 requires insurers to offer at least 5,000 dollars of medical payments (MedPay) coverage with every policy, and you can go without it only by rejecting it in writing.³ MedPay and UM/UIM are different products, but both are coverages Colorado makes the insurer put on the table.

When a driver counts as uninsured or underinsured

"Uninsured" is the easy case: the at-fault driver had no liability policy at all. Colorado also reaches the driver you can't find. Under C.R.S. 10-4-609(6), a tortfeasor is deemed uninsured, so you can collect under your own UM coverage, when that driver can't be located for service of process after a reasonable attempt and no liability coverage is actually known.¹ That's the provision that pulls a hit-and-run or unidentified driver inside your UM coverage.

"Underinsured" is the more common and more misunderstood case. A driver is underinsured when they carry liability coverage, but not enough to pay for what they did to you. C.R.S. 10-4-609(4) defines UIM coverage as paying the difference between the at-fault driver's liability limits and the damages you actually sustained, up to your own UIM limit.¹

The difference-in-limits rule that sets Colorado apart

This is the part worth reading twice. In many states, UIM only fills a "gap": the insurer subtracts the at-fault driver's limits from your policy limit, and whatever is left is all you get. Colorado stopped working that way.

Since a 2008 change to the statute, Colorado UIM is measured against your total damages rather than against your policy limit, and the insurer cannot cut its payment with a setoff for what the at-fault driver already paid.¹ C.R.S. 10-4-609(1)(c) says a single policy may be limited to applying once per accident, but the amount payable "shall not be reduced by a setoff from any other coverage."¹ In plain terms, the at-fault driver's liability payment and your UIM benefits stack instead of canceling out.

The Colorado Court of Appeals spelled out the trigger in Jordan v. Safeco Insurance Co. of America, 2013 COA 47. UIM is triggered by exhaustion of the at-fault driver's limits of legal liability coverage, not by whatever settlement number you end up accepting.⁴ So the math runs: your total damages, minus the at-fault driver's liability limits, equals what your UIM can pay, capped at your UIM limit.

One boundary is built into the same statute. UM/UIM pays for "damages sustained, excluding exemplary damages."¹ Colorado does allow punitive (exemplary) damages against a drunk or reckless driver under C.R.S. 13-21-102, but you pursue those against the driver, not through your own UM/UIM policy.⁵

Anti-stacking clauses have limits

Because the statute bars a setoff and lets benefits add together, Colorado leaves insurers only narrow room to write "anti-stacking" language. A policy can say it applies once per accident, but it can't quietly erase coverage you paid premiums for.¹ If you're hurt in a household with more than one policy or more than one covered vehicle, whether those limits combine is a fact-specific question worth asking a lawyer, because the answer shifted in policyholders' favor after 2008.

The claim deadline is its own clock

Don't assume your UM/UIM claim runs on the same three-year deadline as a lawsuit against the driver. It has a dedicated statute, C.R.S. 13-80-107.5. A UM or UIM claim must be filed, or arbitration demanded, within three years after the cause of action accrues.⁶ That clock starts when you know, or reasonably should know, both the injury and its cause.⁶

There are two safety-valve extensions. If you preserved the underlying claim against the at-fault driver in time, a UM claim is still timely if brought within two years after you learn the driver was uninsured, and a UIM claim is timely if brought within two years after you receive the settlement or judgment payment.⁶ Either way, the statute guarantees you no less than three years from accrual.⁶ These deadlines are strict, and a hit-and-run adds a documentation step, so getting the Colorado crash report on file early matters.

When your own insurer is the one fighting you

A UM/UIM claim has a feature people find jarring: your own insurer becomes the adverse party. It's the company deciding whether your injuries are worth what you say. Colorado hands policyholders a real tool here. Under C.R.S. 10-3-1115 and 10-3-1116, if an insurer unreasonably delays or denies benefits owed to a first-party claimant, you can sue for reasonable attorney fees, court costs, and two times the covered benefit that was delayed or denied.⁷ That statutory remedy sits on top of the benefits themselves, and it applies squarely to a lowballed UM/UIM claim.⁷

What UM/UIM will not do

Colorado UM/UIM covers bodily injury only. Damage to your car is a separate claim, handled through your collision coverage or the at-fault driver's property damage liability rather than your UM/UIM.¹ If your car is worth less after the repair, see diminished value in Colorado. And because Colorado is an at-fault (tort) state rather than a no-fault state, none of this replaces your right to recover from the driver who hit you; UM/UIM is the backstop for when that driver can't pay.⁸

If you're staring at bills after a crash with an uninsured or hit-and-run driver, the coverage math above decides how much money is really available, and insurers don't always run it in your favor. A Colorado attorney can check whether your limits stack and whether the carrier is delaying without cause; you can find one through the legal directory.

This article is general information, not legal advice.

Sources

1. Colorado Revised Statutes § 10-4-609, Insurance protection against uninsured motorists. https://colorado.public.law/statutes/crs_10-4-609

2. Colorado Revised Statutes § 10-4-620, Basic complying policy coverages. https://colorado.public.law/statutes/crs_10-4-620

3. Colorado Revised Statutes § 10-4-635, Medical payments coverage. https://colorado.public.law/statutes/crs_10-4-635

4. Jordan v. Safeco Insurance Co. of America, 2013 COA 47, 348 P.3d 443 (Colo. App. 2013). https://www.courtlistener.com/opinion/2649320/kelly-jordan-v-safeco-insurance-co-of-il/

5. Colorado Revised Statutes § 13-21-102, Exemplary damages. https://content.leg.colorado.gov/sites/default/files/images/olls/crs2024-title-13.pdf

6. Colorado Revised Statutes § 13-80-107.5, Limitation of actions for uninsured or underinsured motorist insurance. https://colorado.public.law/statutes/crs_13-80-107.5

7. Colorado Revised Statutes § 10-3-1116, Remedy for unreasonable delay or denial of insurance benefits. https://colorado.public.law/statutes/crs_10-3-1116

8. Colorado Division of Insurance, Auto Insurance. https://doi.colorado.gov/types-of-insurance/auto-insurance