Auto Insurance Limit
An auto insurance limit refers to the maximum amount of liability coverage (the insurance coverage that covers other people involved in an accident) your insurance company will provide.
Most states have a minimum liability insurance requirements, but this minimum coverage is often not enough to cover only a fraction of medical and repair expenses accrued in a serious - or even fatal - automobile accident.
For this reason, many people choose to purchase significantly more liability insurance than the minimum required.
Purchasing Higher Car Insurance Limits
Auto insurance limits vary by company. The higher the amount of liability coverage you have, the higher your premium will be; however, you will also be better protected if involved in an accident where persons are severely injured or killed, or another person’s property is significantly damaged.
Of course, if the premium seems too high, you can always shop around and compare insurance quotes from other carriers. You might be able to get a lower rate, even if you are increasing the amount of liability coverage.
Understanding Umbrella Policies
The function of an umbrella policy is to cover all expenses not covered by your preexisting insurance policy.
For example, if you are involved in accident that results in $500,000 in medical bills, but your standard policy only covers $100,000, an umbrella policy will cover the remaining $400,000.
An umbrella policy might be less expensive than simply purchasing more liability insurance, but many companies require you to purchase a certain amount of coverage prior to becoming eligible for an umbrella policy. For example, you might need to hold a minimum of $300,000 in bodily injury coverage and $100,000 in property damage coverage to qualify for an umbrella policy.
Hiring an Auto Insurance Attorney
Avoiding a lawsuit is the primary reason for purchasing additional liability insurance. If you are currently facing a lawsuit for personal injury or property damage expenses, you can locate an auto insurance attorney online.