If the other driver carries no insurance, or too little insurance, your own policy may still pay. Oregon requires uninsured motorist coverage on motor vehicle liability policies that insure against bodily injury or death, when the policy is issued for delivery in this state, or when it is issued or delivered by an insurer that does business here for a vehicle principally used or principally garaged here. Section 742.502 is the statute. That coverage must include underinsurance coverage as the section describes.
The practical point is simple. A household that only looks at the other driver’s $25,000 limit can come up short after a serious injury. Uninsured and underinsured coverage on your household policy is often the next place to look, alongside PIP under sections 742.520 and 742.524. Open those first-party claims early, and read the declarations page rather than guessing at the limits.
The limits usually match your bodily injury coverage
A motor vehicle bodily injury liability policy must have the same limits for uninsured motorist coverage as for bodily injury liability coverage unless a named insured in writing elects lower limits. The insured may not elect limits lower than the amounts in section 806.070 for bodily injury or death. Those floors are $25,000 for a single injured or deceased person, and $50,000 when several people are injured or killed in the same wreck, subject to the one-person limit. Property damage has its own $20,000 floor in 806.070, which is a separate figure from the UM injury coverage.
If a named insured does elect lower limits, 742.502(2)(b) requires a signed statement within 60 days after the election. The statement has to acknowledge that matching limits were offered. It has to include a brief summary, which is not part of the insurance contract, describing what uninsured motorist coverage provides and what the underinsured coverage provides. It also has to state the price for coverage at the matching limits and the price for the lower limits requested. The Department of Consumer and Business Services approves the form of that statement. The election stays in force until a named insured rescinds it in writing or the bodily injury liability limits change.
A new signed statement is not required merely because vehicles are added to or subtracted from the policy, or because the policy is amended, renewed, modified or replaced by the same insurer or an insurer in a commonly owned group, unless the liability limits of the policy are changed. If you are not sure whether a lower-limit election is still in force, ask the carrier for a copy of the signed statement and the current declarations.
What underinsurance is doing in the same statute
Uninsured motorist coverage must include underinsurance coverage for bodily injury or death caused by accident and arising from owning, keeping or using a vehicle whose liability insurance provides recovery in an amount that is less than the sums the insured, or the heirs or legal representative, is legally entitled to recover as damages from an uninsured vehicle as the statute describes. Underinsurance coverage must be equal to those sums, up to the limits of the uninsured motorist coverage. Subsections (5) and (6) also require coverage when the amount recovered from liability insurance, or from a self-insurer, is less than those sums.
That is a statute-driven calculation, not a handshake figure from an adjuster. Section 742.504 supplies required provisions for the coverage, and 742.502(4) says underinsurance coverage is subject to 742.504 and 742.542. A disagreement about whether you are legally entitled to recover, or about the amount, may be handled by agreement or, if the parties disagree, through the process 742.504 describes. Read those sections with a lawyer before you take an early offer that treats your UM limits as if they were already used up.
How this sits next to fault, PIP and public-body claims
A UM or UIM claim still depends on what you are legally entitled to recover. Comparative fault under section 31.600 can reduce that amount, or cut it off if your share of fault is larger than the combined share of the people the statute brings into the comparison. PIP can pay early medical bills up to $15,000 and a share of income loss, but it is not a substitute for UM. A hit-and-run in Portland can be reported through the City’s online tool, as our report guide explains, and that kind of wreck is a classic reason to open a UM claim.
If a public body is involved, the 180-day notice in section 30.275 remains a separate duty. Amounts recovered from a public body under Oregon’s public-body liability statutes can affect how 742.502 talks about the amount recovered from other motor vehicle liability insurance. Do not assume a public-body cap, or a payment by the City, quietly replaces the household UM coverage. Our notice guide and our deadline guide belong in the same reading pile.
The two-year period in section 12.110 still matters for a lawsuit against a negligent driver. A first-party UM dispute has its own policy terms. Do not let either clock sneak up while letters go back and forth. If you want a lawyer to sort the coverages, look up whether that person’s Oregon license is still active, and get the fee terms down in a writing you both sign.
Insurers may also offer uninsured motorist limits larger than the 806.070 floors, and even larger than the bodily injury liability limits on the same policy. Section 742.502(3) allows those options, and any such offer still has to include underinsurance coverage of the kind that section describes. If a household can afford higher limits, that conversation belongs with the agent before a crash, not after. After a crash, the task is to read the declarations that were actually in force on the day of the wreck.