Automobile insurance: underinsured motorist coverage.

Existing law prohibits a policy of bodily injury liability insurance covering liability arising out of the ownership, maintenance, or use of any motor vehicle from being issued or delivered in this state to the owner or operator of a motor vehicle, or from being issued or delivered by any insurer licensed in this state upon any motor vehicle then principally used or principally garaged in this state, unless the policy contains, or has added to it by endorsement, a provision with specified coverage limits insuring the insured, the insured's heirs, or legal representative for all sums within the limits that he, she, or they are legally entitled to recover as damages for bodily injury or wrongful death from the owner or operator of an uninsured motor vehicle, except as otherwise provided. Uninsured motorist coverage includes underinsured motorist coverage. Existing law prohibits the maximum liability of an insurer providing underinsured motorist coverage for bodily injury to the insured caused by one or more vehicles from exceeding the insured's underinsured motorist coverage limits, less the amount paid to the insured by or for any person or organization that may be held legally liable for the injury. This bill would authorize an insurer to offer a separately rated underinsured motorist policy where the maximum liability to the insurer is the underinsured motorist coverage limit. The bill would require, if an insurer elects to offer this policy to its insureds, the insurer to notify its insureds of this fact at the time it begins offering the policy, as specified.