Uninsured motorist coverage rules in Vermont

Getting hit by a driver who has no insurance, or too little of it, turns a bad day into a financial problem that can follow you for months. In Vermont, the coverage that answers for that driver isn't theirs. It's yours. Uninsured and underinsured motorist coverage (UM and UIM) sits inside your own auto policy, and state law decides how much you carry and when it pays.

Here's what Vermont actually requires, and where the rules differ from what you might expect.

Vermont builds this coverage into every policy

You can't buy a Vermont auto policy without UM/UIM coverage. Section 941 of Title 23 requires every policy issued in the state to protect the people it insures against "uninsured, underinsured, or hit-and-run" drivers, for bodily injury and for property damage.¹ It isn't an add-on you opt into. It comes standard, and the statute gives you no way to strip it below the legal floor.

That floor is $50,000 for one person injured or killed and $100,000 for two or more people in the same crash.¹ If you carry liability limits higher than that, your UM/UIM limits have to match them, unless you tell your insurer to keep them lower.¹ A Vermont driver with 250/500 liability coverage carries 250/500 in UM/UIM by default.

This is where Vermont parts ways with many other states. A lot of them let you reject uninsured motorist coverage with a signed waiver. Vermont doesn't. The only choice the statute hands you is whether your UM/UIM limits rise to match higher liability limits, not whether you keep the coverage.

The state minimum is low, which is the point of UIM

Every registered vehicle in Vermont has to carry at least $25,000 per person and $50,000 per crash for bodily injury, plus $10,000 for property damage. A driver can post $115,000 of self-insurance with the Commissioner of Motor Vehicles instead.² Those numbers, 25/50/10, are the most that a minimally insured at-fault driver is required to have available for you.

Serious injuries blow past $25,000 fast. When the at-fault driver's liability limit runs out before your bills do, your underinsured motorist coverage fills the difference. Vermont's Supreme Court has described UM/UIM as "portable" protection that follows the person who bought it and works as a form of self-insurance, meant to give the prudent driver "maximum insurance coverage" when a marginally insured or uninsured motorist causes the wreck.³

What counts as uninsured or underinsured in Vermont

Uninsured means more than "no policy at all." Under Section 941, a vehicle also counts as uninsured if the at-fault driver's insurer becomes insolvent, as long as the insolvency happens at the time of the crash or within one year after it.¹ Hit-and-run and unidentified ("unknown") drivers fall under the same coverage, so a phantom vehicle that runs you off the road and vanishes can still trigger a claim.¹

Underinsured is defined by a gap. A vehicle is underinsured to the extent the at-fault driver's liability limits are lower than your own UM/UIM limits, or to the extent the available liability money has been cut by payments to other people hurt in the same crash below your UM/UIM limit.¹ That second part matters in multi-victim crashes. Vermont wrote it into Section 941(f) in 2005 after its Supreme Court flagged a hole in the older "limits to limits" rule that could leave a passenger worse off when several people had to share one driver's coverage.³

A quick example. Say the at-fault driver carries the state-minimum $25,000 per person and you carry $100,000 in UIM. If your damages come to $80,000, you collect the $25,000 from their insurer, and your own UIM coverage answers for the remaining $55,000 up to your limit.

When an uninsured driver damages your car

Vermont is unusual in folding property damage into uninsured motorist coverage. Section 941 requires UM coverage to pay for damage to your vehicle from an uninsured or hit-and-run driver, up to $10,000 per claim, subject to a $150 deductible.¹ If you already carry collision coverage, the statute coordinates the two so the UM property-damage money can go toward your collision deductible.¹

That $10,000 cap covers the repair or replacement. It doesn't reach the lost resale value a crash leaves on your car's history. If your vehicle is worth less after a proper repair, that's a separate diminished value claim, and how those work in Vermont is covered here: diminished value in Vermont.

Fault, deadlines, and the steps that protect your claim

Because UM/UIM pays what you are "legally entitled to recover" from the other driver, Vermont's fault rules carry into your own claim. The state uses modified comparative negligence: you can recover as long as your share of the fault is not greater than the other driver's, and your damages drop by your percentage of fault.⁴ Once your share passes 50 percent, you recover nothing, so how fault gets assigned directly changes what your UM/UIM coverage owes.

Timing runs on two clocks. A negligence claim for injury to your person has to be filed within three years, measured from when you discover the injury, and the same three-year deadline covers damage to your personal property.⁵ A UM/UIM claim is different in kind: it's a claim against your own insurer under your policy, which is a contract, and Vermont's general limitation period for a contract action is six years.⁶ The interplay between those deadlines and your policy's own notice terms gets technical quickly, so the safe approach is to treat the three-year injury deadline as your outer limit and act well before it.

Vermont law hands you a few practical tools. You can send any insurer that might owe on the crash a written request for its policy limits, and Section 941 requires a written answer within 30 days.¹ Keep the crash well documented; the Vermont DMV processes crash report requests, and you can start that here: Vermont crash reports. And if your own insurer pays your UM/UIM claim, it gains subrogation rights against the at-fault driver, reduced by a fair share of the costs of getting the recovery.¹

One more piece of context. Vermont is an at-fault (tort) state, not a no-fault state, so there's no mandatory personal injury protection to lean on while a UM/UIM claim plays out.⁷ That puts more weight on the coverage you carry and on documenting the claim well. If a claim gets denied or the numbers don't add up, a Vermont injury attorney can push back: find an attorney in our legal directory.

This article is general information, not legal advice.

Sources

23 V.S.A. § 941, Insurance against uninsured, underinsured, or unknown motorists. Vermont General Assembly. https://legislature.vermont.gov/statutes/section/23/011/00941
23 V.S.A. § 800, Maintenance of financial responsibility. Vermont General Assembly. https://legislature.vermont.gov/statutes/section/23/011/00800
Progressive Casualty Insurance Co. v. MMG Insurance Co., 2014 VT 70. Vermont Supreme Court. https://outside.vermont.gov/dept/vtlib/Documents/Progressive%20Casualty%20Insurance%20Company.pdf
12 V.S.A. § 1036, Contributory and comparative negligence. Vermont General Assembly. https://legislature.vermont.gov/statutes/section/12/027/01036
12 V.S.A. § 512, Injuries to person or property. Vermont General Assembly. https://legislature.vermont.gov/statutes/section/12/023/00512
12 V.S.A. § 511, Civil action (six-year limitation). Vermont General Assembly. https://legislature.vermont.gov/statutes/section/12/023/00511
Insurance requirements. Vermont Department of Motor Vehicles. https://dmv.vermont.gov/enforcement-and-safety/laws/insurance

Uninsured Motorist Coverage Rules in Vermont