UM/UIM Arbitration in Illinois: What to Expect

Last Updated: October 28, 2026

215 ILCS 5/143a(1) requires the policy to send a dispute about uninsured or hit-and-run coverage, and about the amount of damages, to the American Arbitration Association when those covered-claim issues are in dispute. The insured may instead ask each side to name an arbitrator, and those two name a third. If they are not named within 45 days, either party may send the dispute to the Association. Their decision is binding for damages not exceeding $75,000 for one person, $150,000 for two or more people, or the corresponding bodily-injury policy limits, whichever is less. Whether the policy covers the crash at all is ordinarily a court question, not an arbitrators’ question.

Why UM/UIM Claims Go to Arbitration

When you file an uninsured or underinsured claim, you are making a claim against your own insurer. 215 ILCS 5/143a(1) requires the described liability policy to submit a dispute about uninsured or hit-and-run coverage, and about the amount of damages, to arbitration when those issues arise under a covered claim. Illinois courts construe that language narrowly: whether the policy covers the crash at all is ordinarily a question for a court, not the arbitrators. See American Service Ins. Co. v. Passarelli, No. 1-00-2543 (Ill. App. Ct. 1st Dist. 6th Div. June 22, 2001) (applying State Farm Mut. Auto. Ins. Co. v. Yapejian, 152 Ill. 2d 533 (1992)). Section 143a-2 governs underinsured motorist coverage separately and does not impose the same mandatory arbitration framework on every UIM dispute. Whether and how a UIM dispute is arbitrated, and how final an award is, depends on the policy. The Illinois Supreme Court has enforced UIM trial-de-novo provisions. See Phoenix Ins. Co. v. Rosen, 242 Ill. 2d 48 (2011).

Arbitration is a private proceeding where one or more neutral arbitrators hear both sides and issue a decision. While it lacks some of the procedural protections of a courtroom trial, it can be faster and less expensive. Understanding the process helps you prepare effectively.

How UM/UIM Arbitration Works in Illinois

The statute sends the dispute to the American Arbitration Association. Alternatively, the insured may request that each party select an arbitrator and that those two select a third. If the arbitrators are not selected within 45 days of that request, either party may submit the arbitration to the Association. For medical opinions, Association rules apply when the amount sought is equal to or less than the section 7-203 amount. Above that amount, the circuit-court rules for medical opinions apply.

Before the hearing, both sides exchange evidence through a discovery process that is usually more limited than in a courtroom case. Medical records, accident reports, expert opinions, and witness statements are gathered and shared. Your attorney may depose witnesses or retain medical experts to support your claim.

At the hearing itself, both sides present their case much like a trial. Your attorney will present evidence of the accident, your injuries, your medical treatment, and your damages. The insurance company’s attorney will challenge the severity of your injuries, dispute causation, or argue that your damages are lower than claimed. After both sides present, the arbitration panel deliberates and issues an award.

Binding vs. Non-Binding Arbitration

For uninsured and hit-and-run bodily-injury claims under section 143a(1), a three-arbitrator decision is binding for bodily injury or death not exceeding $75,000 for one person, $150,000 for two or more people in one crash, or the corresponding policy limits, whichever is less. Underinsured motorist awards are not governed by those same statutory caps. Whether an award is binding, or either party may reject it and seek a trial de novo, depends on the policy. The Illinois Supreme Court has enforced UIM trial-de-novo provisions. See Phoenix Ins. Co. v. Rosen, 242 Ill. 2d 48 (2011).

The policy can still state who is an insured. The $75,000 and $150,000 figures above are the section 143a(1) uninsured and hit-and-run binding amounts, not every underinsured motorist contract term.

Preparing for a Strong Arbitration Case

Success in UM/UIM arbitration depends on the strength of your evidence. Key elements include comprehensive medical documentation linking your injuries to the accident, evidence of the at-fault driver’s lack of adequate insurance, documentation of all economic losses including medical bills and lost wages, and testimony about how the injuries have affected your daily life and long-term functioning.

Having an attorney is particularly important in arbitration because insurance companies take these proceedings seriously and come prepared with their own experts and legal arguments. The personal injury lawyers at Parker & Parker can help you organize medical and liability evidence, comply with policy notice and arbitration procedures, and present your case at the hearing.

Our Peoria UM/UIM arbitration page shows how we prepare the arbitration file step by step.

What Happens After the Arbitration Award

If the arbitrators issue an award, the binding limit for qualifying uninsured and hit-and-run claims is the one stated above. A refusal or a delay in payment is not, by itself, a finding under 215 ILCS 5/155. That section requires a court to find that an action on the policy, or a delay, was vexatious and unreasonable.

If you are facing a UM/UIM dispute with your insurance company, do not try to handle arbitration on your own. Contact Parker & Parker to discuss your claim and learn how we can advocate for you throughout the arbitration process.

Injured? Get a Free Case Review.

Parker & Parker reviews personal injury claims for people in Peoria and across Central Illinois. Call 309-673-0069 or contact us online for a free consultation.

Frequently Asked Questions

Do UM/UIM claims go to court in Illinois?

Once uninsured or hit-and-run coverage is in dispute under a covered claim, section 143a(1) sends disputes about that coverage and the amount of damages to arbitration. Whether the policy covers the crash at all is ordinarily a question for a court. See American Service Ins. Co. v. Passarelli, No. 1-00-2543 (Ill. App. Ct. 1st Dist. 6th Div. June 22, 2001) (applying State Farm Mut. Auto. Ins. Co. v. Yapejian, 152 Ill. 2d 533 (1992)). Underinsured motorist disputes depend on the policy and section 143a-2; they are not subject to the same mandatory arbitration framework.

How does UM/UIM arbitration work?

The statute sends the dispute to the American Arbitration Association. The insured may request that each side name one arbitrator and that those two name a third. If they are not named within 45 days, either party may send the dispute to the Association.

Is a UM/UIM arbitration award final?

For uninsured and hit-and-run claims under section 143a(1), a qualifying arbitration decision is binding up to $75,000 for one person, $150,000 for two or more people, or the corresponding bodily-injury policy limits, whichever is less. For underinsured motorist claims, finality depends on the policy. Many policies make some awards binding and allow either side to reject an award and ask for a trial. See Phoenix Ins. Co. v. Rosen, 242 Ill. 2d 48 (2011). Review your policy with an attorney.

Being hit by an uninsured or underinsured driver can leave you feeling helpless. Our personal injury lawyers know how to navigate these complex claims.

Need a lawyer? This article is part of our Peoria Car Accident Lawyer practice area. Call Parker & Parker at 309-673-0069 for a free consultation.