Understanding Liability Coverage car insurance advice
Understanding how liability coverage works will help you make an informed decision when taking out your car insurance policy, which will save you a lot of money and aggravation in the future. Liability insurance essentially covers any costs associated with your legal defense and other expenses incurred as a result of a car accident, which cause the injury of any of the parties involved.
car insurance claims advice
The amount that the injured party will sue you for depends a lot on you, namely what you are worth. So, if you have a good income, with plenty of assets, or even if you just have a good potential income you will find that the amount goes up. The problem is that if the amount the injured party is awarded is higher than your liability coverage then there is a good chance you will be pursued personally to pay the balance, even if it means covering these costs from your future income. On the other hand if your car insurance policy has a higher level of liability coverage, which comes close to what the injured party is demanding then you will have a better chance of settling for that amount.
Raising your liability limit is often not as expensive as you may think and your return on investment will be worth it. For example, for an additional $150 per year you can raise your limit to approximately $500,000, which is a small amount if you consider the consequences. Of course, this amount is likely to vary from one car insurance policy to another, but the difference won’t be extreme.
Also, you will want to be careful if you decide to take out a split limit policy, which group liabilities into three main categories. These are injuries you cause to a single person, another for all injuries caused in an accident involving two or more people and another for any damage you may cause to property in a single accident. You may think this is an excellent idea because you will have one big umbrella per accident, but this is not the case because even if your accident limit is $300,000, if your limit per person is $100,000 that is all your policy will cover. If the jury awards the person $200,000 you will be personally responsible for the extra $100,000, therefore you are much better off taking out a single-limit coverage policy.
car insurance claims advice
Even if you have never had a car accident in your life, using this to justify low liability coverage is like saying that you don’t need car insurance at all because you are a great driver. If one thing is certain in life is that nothing is ever certain and the question you need to ask yourself is whether or not you can afford to be short-sighted.
Understanding how liability coverage works will help you make an informed decision when taking out your car insurance policy, which will save you a lot of money and aggravation in the future. Liability insurance essentially covers any costs associated with your legal defense and other expenses incurred as a result of a car accident, which cause the injury of any of the parties involved.
Car insurance advice
One of the most common issues when it comes to liability is that often people tend to either buy too little coverage or the limits they set are inconsistent. For example, they set a higher limit on their house than they do their car, which proves how little thought people give this issue. Compare the probability of someone seriously injuring themselves in your home versus you being involved in a car accident and you will better understand why you need to take out a car insurance policy that gives you a high level of liability coverage.
The injured party in a car accident will often be awarded medical expenses incurred as a result of the injury, pain and suffering, as well as lost wages for the period he is recovering. The amount all depends on what the person does for a living, ergo their yearly income. Therefore, if you hit a banker then you could end up owing at the very least $250,000 just for lost wages, let alone medical bills or pain and suffering. Your car insurance policy will cover whatever the limit you set and you will have to come up with the balance. So if you decided to take out liability of $100,000 on your car but have $300,000 on your home, then you may have a serious problem as you will have to cover the remaining $150,000.
One of the most common issues when it comes to liability is that often people tend to either buy too little coverage or the limits they set are inconsistent. For example, they set a higher limit on their house than they do their car, which proves how little thought people give this issue. Compare the probability of someone seriously injuring themselves in your home versus you being involved in a car accident and you will better understand why you need to take out a car insurance policy that gives you a high level of liability coverage.
The injured party in a car accident will often be awarded medical expenses incurred as a result of the injury, pain and suffering, as well as lost wages for the period he is recovering. The amount all depends on what the person does for a living, ergo their yearly income. Therefore, if you hit a banker then you could end up owing at the very least $250,000 just for lost wages, let alone medical bills or pain and suffering. Your car insurance policy will cover whatever the limit you set and you will have to come up with the balance. So if you decided to take out liability of $100,000 on your car but have $300,000 on your home, then you may have a serious problem as you will have to cover the remaining $150,000.
car insurance claims advice
The amount that the injured party will sue you for depends a lot on you, namely what you are worth. So, if you have a good income, with plenty of assets, or even if you just have a good potential income you will find that the amount goes up. The problem is that if the amount the injured party is awarded is higher than your liability coverage then there is a good chance you will be pursued personally to pay the balance, even if it means covering these costs from your future income. On the other hand if your car insurance policy has a higher level of liability coverage, which comes close to what the injured party is demanding then you will have a better chance of settling for that amount.
Raising your liability limit is often not as expensive as you may think and your return on investment will be worth it. For example, for an additional $150 per year you can raise your limit to approximately $500,000, which is a small amount if you consider the consequences. Of course, this amount is likely to vary from one car insurance policy to another, but the difference won’t be extreme.
Also, you will want to be careful if you decide to take out a split limit policy, which group liabilities into three main categories. These are injuries you cause to a single person, another for all injuries caused in an accident involving two or more people and another for any damage you may cause to property in a single accident. You may think this is an excellent idea because you will have one big umbrella per accident, but this is not the case because even if your accident limit is $300,000, if your limit per person is $100,000 that is all your policy will cover. If the jury awards the person $200,000 you will be personally responsible for the extra $100,000, therefore you are much better off taking out a single-limit coverage policy.
car insurance claims advice
Even if you have never had a car accident in your life, using this to justify low liability coverage is like saying that you don’t need car insurance at all because you are a great driver. If one thing is certain in life is that nothing is ever certain and the question you need to ask yourself is whether or not you can afford to be short-sighted.
No comments:
Post a Comment