What Happens in Uninsured Motorist Arbitration?

An uninsured or underinsured motorist claim is a claim against your own insurer, but it is measured by what you could recover from the other driver. When you and your insurer see that differently, California does not send the dispute to a jury. It sends it to an arbitrator, and the rules are written into Insurance Code section 11580.2.

The steps, in order

1. Open the UM or UIM claim early and give your insurer your medical records, bills, wage proof and the police report.
2. Negotiate. Most disagreements are about value, not about whether coverage exists. Ask for the insurer's evaluation in writing.
3. Calendar the two-year date. Negotiation does not pause it.
4. Demand arbitration in writing, by certified mail with return receipt, to your insurer or its designated agent for process, before the two years run out if you have not agreed.
5. Choose the arbitrator. The policy's arbitration provision describes how; read it.
6. Exchange information. The statute makes California's civil discovery rules available to both sides, with some limits, and treats the hearing like a trial for subpoena purposes.
7. The hearing and award. The arbitrator decides entitlement and amount, within your policy limits.

What to gather before the hearing

• Complete medical records and itemized bills, including future treatment your doctors expect.
• Proof of lost earnings: pay records, a letter from your employer, tax returns if self-employed.
• The police report, photos, and statements from witnesses.
• Proof that the other driver was uninsured, or of the limits their insurer paid if the claim is underinsured.
• Every written offer and evaluation your insurer has sent.

If workers' compensation is involved

If you were hurt on the job and have, or may have, workers' compensation benefits, the arbitrator may not proceed until your condition is stationary and ratable. Any demand or petition for arbitration must include a declaration under penalty of perjury about the workers' compensation claim and its status. The statute also extends the time to conclude the arbitration in that situation.

What the award does and doesn't do

The award resolves the claim between you and your insurer. The statute says it is not conclusive in any action between you and the uninsured motorist. Your insurer, having paid, can pursue the uninsured driver for what it paid.

What can go wrong

• Letting two years pass while waiting for an offer. It is the easiest way to lose a UM claim, and the most avoidable.
• An informal demand. An email or phone call is not the certified-mail notice the statute describes.
• Settling with the at-fault driver first without your insurer's written consent, which can end the UM claim before arbitration is even possible.

Arbitration is a legal proceeding, and many people use a lawyer for it, especially with significant injuries. Your UM and UIM limits are the ceiling on any award, so they are worth revisiting; request a quote with higher limits.