When you buy auto insurance in Arizona, most of the conversation with your agent usually focuses on liability coverage. Liability is incredibly important, but it only protects other people if you cause an accident.
But what happens when someone else hits you, and they don't have enough insurance—or any at all—to pay for your medical bills?
In Arizona, roughly 10.6% of drivers are completely uninsured. To make matters worse, many who do carry insurance only buy the state-mandated minimums, which can disappear after a single night in a Phoenix-area emergency room.
To safeguard your health and your wallet, you need to understand three crucial components of an Arizona auto insurance policy: Uninsured Motorist (UM), Underinsured Motorist (UIM), and Medical Payments (MedPay) coverage. Here is how they work together to form a financial safety net.
1. Uninsured Motorist (UM) Coverage
Uninsured Motorist coverage pays for your medical bills, lost wages, and pain and suffering if you are hit by a driver who has no auto insurance at all.
- The Hit-and-Run Protection: UM coverage also applies if you are the victim of a hit-and-run accident. In Arizona, insurance companies treat a phantom or fleeing driver as an uninsured motorist, ensuring your medical costs are covered even if the police can't find the culprit.
- The Law: Under A.R.S. § 20-259.01, Arizona insurance companies are legally required to offer you UM coverage in writing. You are not forced to take it, but if you choose to reject it, you must sign a formal waiver.
2. Underinsured Motorist (UIM) Coverage
Underinsured Motorist coverage kicks in when the at-fault driver has insurance, but their policy limits are too low to cover the full extent of your injuries.
In Arizona, the minimum legal liability limit for bodily injury is $25,000 per person. Consider this scenario:
- You are injured by an at-fault driver and face $75,000 in medical expenses.
- The at-fault driver carries the state minimum, meaning their insurance will only pay $25,000.
- If you have UIM coverage, your own policy will bridge the $50,000 gap, saving you from personal bankruptcy or having to sue an individual who likely has no assets.
Like UM, UIM is optional but must be offered to you in writing.
3. Medical Payments (MedPay) Coverage
While UM and UIM depend on who caused the accident, Medical Payments (MedPay) coverage pays for necessary and reasonable medical expenses for you and your passengers regardless of who is at fault.
MedPay acts as an immediate, no-fault buffer. It is incredibly useful for:
- Covering health insurance deductibles, co-pays, or treatments that health insurance denies.
- Paying out immediately while you wait for a third-party insurance claim or a UM/UIM claim to process (which can sometimes take months or years).
- Paying for an ambulance ride, ER visits, x-rays, or chiropractic care right out of the gate.
How to Structure Your Policy for Full Protection
To make sure you aren't left holding the bag after an accident, insurance and legal professionals generally suggest the following framework:
| Coverage Type |
What it Protects |
Recommended Limit |
| Liability |
Everyone else's injuries and property if you cause a crash. |
Match your net worth; typically $100,000 / $300,000 minimum. |
| UM / UIM |
You and your family's injuries if a bad driver hits you. |
Match your liability limits. Do not protect strangers more than you protect your own family. |
| MedPay |
Immediate out-of-pocket medical bills / deductibles. |
$5,000 to $10,000 as a supplementary safety net. |
The Golden Rule: Stacking Your Insurance
Arizona allows you to use multiple layers of coverage to protect yourself. If you are severely injured, you can potentially utilize the at-fault driver's policy, your own MedPay policy for immediate relief, and your UIM policy to cover the remaining catastrophic bills.
The cost to add UM, UIM, and MedPay to your auto policy is typically nominal—often just
$15 to $30 a month. Given that you have a
two-year statute of limitations in Arizona to sort out personal injury claims, having your own insurance company backing you up from day one provides invaluable peace of mind.
Don't wait until an accident happens to find out what is in your policy. Check your insurance portal or call your broker today, and make sure your UM and UIM boxes are firmly checked.
Confused About Your Arizona Policy? We Can Help.
Speak with one of our insurance specialists with over 50 years combined experience, we can help you better understand all your coverage options. At ALCO Insurance Agency, we can help answer all your insurance coverage questions and build a policy that suits your needs and budget.