Underinsured Motorist Insurance: Do You Need It?

Some Swiss car insurance providers offer underinsured motorist insurance as a rider for car insurance policies. If you drive to foreign countries often, getting informed about underinsured driver insurance is worth it.

What is underinsured driver insurance?

Underinsured driver insurance covers your liability claims for damage to your car and injury to you by guilty drivers who do not have sufficient third-party liability insurance to meet your claims. This can happen when you drive your car to a country which has low third-party liability car insurance requirements for drivers using its roads.

What is covered by underinsured driver insurance?

Swiss underinsured driver insurance covers your liability claims against a third party which exceed the coverage already provided by the third party’s third-party liability car insurance. Swiss underinsured driver insurance does not include uninsured driver coverage. If the driver at fault does not have liability car insurance at all, you cannot claim any benefits.

Your uninsured driver insurance only covers your car. It does not cover cars which you rent or borrow.

How much loss does underinsurance driver insurance cover?

Typically, the sum insured is identical to that of your third-party liability car insurance. Swiss law requires Swiss third-party liability insurance to cover a minimum of five million francs. However, Swiss insurance providers typically cover up to 100 million francs.

When does getting underinsured driver insurance make sense?

If you frequently drive to countries outside of EFTA and the EU, getting underinsured driver insurance can be a good financial move.

In some countries, the third-party liability car insurance which drivers are required to have is not sufficient to compensate for serious injury or disability. In some cases, divers may not have sufficient insurance to fully cover damages to your car.

In Albania, for example, the law only requires regular cars to have a minimum of 55 million Albanian Lek (around 520,000 Swiss francs, as per May 2025). In Ukraine, the minimum required insurance for third-party liability is just UAH 250,000 for property damage, and UAH 500,000 for injuries to people. That converts into just around 2400 francs and 4800 francs respectively (as per May, 2025).

Outside of Europe, mandatory third-party liability insurance coverage can be even lower.

For this reason, adding underinsured motorist insurance is a good move if you frequently travel to countries with low insurance requirements. With underinsured motorist insurance, you will be compensated for injuries and/or damage to your car and other property even if the guilty driver does not have enough insurance to cover your claims.

Does having underinsured driver insurance make financial sense if I only drive in Switzerland and EU countries?

No. In most cases getting underinsured driver insurance is not necessary if you only drive in Switzerland and EU countries.

All cars using Swiss roads must be adequately insured. The Swiss Road Traffic Insurance Ordinance obliges all vehicles on public Swiss roads to be covered against third-party liability up to 5 million Swiss francs per accident (10 million francs for vehicles which seat more than 10 individuals). Vehicles which are not adequately covered must purchase frontier insurance when entering Switzerland or Liechtenstein. This means that your legal liability claims against foreign vehicles will generally be met when the accident occurs in Switzerland. Payment of your liability claims is guaranteed by the Swiss National Bureau of Insurance as stipulated by the Swiss Road Traffic Insurance Ordinance and the Swiss Road Traffic Act.

Other EFTA countries also have high third-party liability car insurance requirements for all drivers using their roads.

The EU also has recently implemented high requirements for vehicles using public roads. Underinsured vehicles from other countries must obtain frontier insurance when entering the EU. The minimum liability car insurance coverage required in European Union member countries is 1,220,000 euros per victim (maximum 6,070,000 euros for all victims combined) for bodily injury and 1,220,000 euros for combined property damage.

For these reasons, buying underinsured motorist insurance if you only drive in Switzerland and EU or EFTA countries generally is not necessary – although it can provide more optimal financial protection (for driving in some EU countries, for example).

What should I consider when getting underinsured motorist insurance?

Only a few Swiss car insurance providers offer underinsured driver insurance. This means you may need to change to a different car insurance provider to get this coverage. Before changing car insurance providers, make sure to compare the total premiums for all of the insurance you need.

Coverage is limited to the geographical scope of your third-party liability car insurance policy, so you are not covered when you drive to countries which are not covered by your liability car insurance. Swiss liability car insurance policies typically cover countries within the Green Card system region, but all of them exclude certain countries. Some cover countries which border the Mediterranean, including North African countries, but exclusions typically apply. Some policies cover Kosovo, others do not. Russia is generally excluded. There is no point in getting underinsured driver insurance if your third-party liability car insurance does not cover the countries which you want to insure yourself for.

You can find out which countries are covered by your Swiss car insurance by looking at the International Motor Insurance Card (Green Card) which you get from your insurance provider. Only the Green Card member countries which are not crossed off are covered by your insurance.

When you travel to countries that are not covered by your insurance provider, you have to purchase temporary third-party liability insurance at the border. This temporary insurance generally does not include any underinsured driver coverage. However, there are international insurance companies that offer worldwide car insurance which includes some underinsured motorist coverage. These can provide an alternative for travel to countries which are not covered by your Swiss car insurance.

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