Virginia Underinsured Motorist Coverage: How the 2023 Change Affects You
Key takeaways
- Since July 1, 2023, Virginia underinsured motorist (UIM) coverage pays in addition to the at-fault driver’s liability limits instead of being reduced by them. This is often called “add-on” coverage.
- You can still choose the older “reduced-by” setup, but only by electing it in writing. For most drivers, add-on coverage gives more protection.
- Virginia’s minimum liability limits rose to $50,000 / $100,000 / $25,000 on January 1, 2025, and your UM/UIM limits can’t be lower than those minimums.
- If you haven’t looked at your UIM limits in a while, a quick policy review can confirm how your coverage is set up.
Virginia changed how underinsured motorist (UIM) coverage works on July 1, 2023, and it is still one of the most meaningful protections for Virginia drivers. If you drive in Virginia or insure vehicles there, here is how it works today and what to check on your own policy.
Virginia’s Minimum Auto Insurance Limits
For policies effective on or after January 1, 2025, Virginia requires minimum liability coverage of $50,000 per person and $100,000 per accident for bodily injury, plus $25,000 for property damage. Before that, the minimums were $30,000 / $60,000 / $20,000. Your uninsured and underinsured motorist (UM/UIM) limits must be at least as high as those minimums.
Virginia also ended its option to pay a fee to drive uninsured as of July 1, 2024, so every driver now needs at least the minimum coverage. Keep in mind that the minimums are a floor, not a recommendation. A serious accident can easily cost more than $50,000, which is exactly where UIM coverage comes in.
What Changed in 2023: Add-On Coverage
Before July 1, 2023, Virginia used a “reduced-by” approach. Your UIM payout was reduced by whatever the at-fault driver’s liability insurance paid. If you carried $100,000 in UIM and the at-fault driver had $50,000 in liability coverage, your UIM would only add $50,000, for $100,000 total.
Under the current law, UIM coverage is “add-on” by default. It pays on top of the at-fault driver’s liability coverage instead of being reduced by it. In the same example, you could recover the at-fault driver’s $50,000 plus up to your full $100,000 in UIM, for up to $150,000 toward your damages.
Can you opt out?
Yes. A policyholder can elect in writing to keep the older reduced-by setup, which may lower the premium slightly. For most households, add-on coverage is the stronger choice, so it is worth knowing which one your policy has.
What This Means for Your Policy
If you insure vehicles in Virginia, three things are worth checking: whether your UIM is add-on or reduced-by, whether your UIM limits match your liability limits, and whether those limits would realistically cover medical bills and lost income after a serious accident. Capitol Benefits can review your declarations page with you and compare options from 100+ carriers if it makes sense to look around.
Frequently Asked Questions
What is underinsured motorist coverage?
It covers you when the at-fault driver has liability insurance, but not enough to pay for your injuries and losses. It fills the gap between their coverage and what your damages actually total.
What is add-on UIM coverage in Virginia?
Since July 1, 2023, Virginia UIM coverage pays in addition to the at-fault driver’s liability limits rather than being reduced by them, unless the policyholder elects the reduced-by option in writing.
Is this the same as stacking?
No. Stacking refers to combining coverage across multiple vehicles. Add-on coverage is about UIM paying on top of the other driver’s liability insurance. Ask your agent how your specific policy handles both.
What are Virginia’s minimum auto insurance limits?
For policies effective on or after January 1, 2025, the minimums are $50,000 per person and $100,000 per accident for bodily injury, and $25,000 for property damage.
How much UIM coverage should I carry?
Enough to cover the medical costs and lost income a serious accident could realistically produce, which is generally well above the state minimums. Your agent can price several limit options side by side.
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