Texas Insurance Code § 1952.152 – Conditions for Providing Underinsured Motorist Coverage
Table of Contents
Statutory Text:
Sec. 1952.152. CONDITIONS FOR PROVIDING UNDERINSURED MOTORIST COVERAGE.
(a) The underinsured motorist coverage required by this subchapter may provide for the exclusion of benefits to:
(1) an insured injured while occupying or struck by an underinsured motor vehicle owned by that insured; or
(2) an insured who, without the insurer’s written consent, makes a settlement with and releases from liability an owner or operator of an underinsured motor vehicle.(b) The coverage may also provide that any decision of the insurer relating to the settlement of a claim under the coverage that is not made in good faith is not binding on the insured.
What Does This Law Mean for Injury Victims?
§ 1952.152 identifies key exclusions and settlement restrictions that could limit your ability to recover UIM benefits. It allows insurers to:
Deny coverage if you are hit by your own underinsured vehicle
Deny coverage if you settle with the at-fault driver without their consent
However, the law also protects you by stating that insurers must act in good faith when handling your claim. If they don’t, their decisions are not binding — and may support a bad faith lawsuit.
Example Scenario
You’re hit by a driver with only $30,000 in liability coverage. Your injuries are worth over $100,000. You accept the $30,000 settlement without first notifying your insurer. Later, your insurance company denies your UIM claim based on § 1952.152(a)(2). Unless you can show bad faith or obtain a waiver, your recovery may be limited.
When This Law Applies
This statute applies to first-party UIM claims filed after:
A collision with an underinsured driver
Partial recovery from the other driver’s insurance
Disputes over UIM claim settlement amount
Claims where the victim may have settled too soon or failed to get written approval
Related Statutes
§ 1952.101 – UIM/UM Coverage Requirements
§ 1952.158 – UIM Insurer Subrogation Rights
§ 541.060 – Bad Faith Insurance Conduct
§ 542.058 – Penalties for Delay in Payment
§ 1952.159 – UIM Stacking Limitations
Texas Case Law Interpreting § 1952.152
Confirmed that UIM benefits are not owed until liability and damages are established, and settlement procedures must be followed.
Reinforced that insurers may limit coverage when a settlement is made without written consent.
Held that insurers must act in good faith when handling UIM disputes — otherwise, the insured is not bound.
Frequently Asked Questions About § 1952.152
Houston Personal Injury Lawyer - Joel A. Gordon
Yes, if you do so without written consent from your insurer. Always notify your insurance company before settling.
Your UIM coverage may exclude this unless your policy allows it. Carefully review your declarations and exclusions.
If your insurer denies or limits your claim unfairly, you can challenge that decision and possibly sue for bad faith.
Sometimes. Your attorney may be able to obtain a waiver or argue that the insurer acted unreasonably.