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Can a Car Accident Claim Be Higher Than Policy Coverage?

Accidents happen unexpectedly, and they can have significant financial and emotional consequences. When involved in a car crash in Los Angeles, it’s crucial to understand your insurance coverage and its potential limitations with regard to the ability to recover damages in a car accident claim.

One common concern is whether a car accident claim can exceed insurance policy limits. This article will explore this question, provide insights into auto insurance requirements, discuss the implications of exceeding policy limits, and offer guidance on navigating such situations.

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Understanding Auto Insurance Policy Limits

Before delving into the possibility of a car accident claim exceeding insurance policy limits, let’s first understand the policy limits. Auto insurance policy limits refer to the maximum amount an insurance company will pay for covered damages and losses resulting from an accident. The insurance policy typically outlines these limits and varies based on the coverage type.

In most states, including California, liability insurance is mandatory for all drivers. Liability insurance covers damages and injuries caused to others in an accident for which you are at fault.

Liability coverage is a safeguard against the potential financial fallout that can arise from accidents for which you are at fault. This coverage does not, however, extend to cover injuries sustained by you or members of your family. To ensure comprehensive protection, you can purchase medical payment coverage specifically tailored to address these needs.

California has set forth minimum insurance limits that individuals must adhere to under a standard auto insurance policy. These minimums represent the lowest acceptable levels of coverage that must be in place.

Bodily Injury Liability Limits

  • $15,000: This amount is allocated to cover the death or injury of any individual involved in an accident where the policyholder is responsible. If a single person sustains injuries, liability coverage extends up to $15,000 for medical expenses and damages.
  • $30,000: In the unfortunate event that more than one person is injured or loses their life in a single accident, coverage extends to $30,000. This sum will be shared among the injured parties, ensuring that financial support is available to those affected by your actions.

It is important to note that these limits apply exclusively to injuries you cause to others. Your liability coverage serves as a lifeline for those affected by your actions on the road.

Minimum Property Damage Liability Limits

$5,000: When it comes to property damage resulting from an accident, liability coverage provides up to $5,000 in financial support. This allocation is intended to cover damages to vehicles, objects, or structures impacted by the car.

From repairing another person’s vehicle to covering expenses related to objects your car may collide with, this aspect of liability coverage ensures that you can meet your obligations to those who have suffered property damage due to your actions.

What If a Car Accident Exceeds Policy Limits?

While insurance policy limits serve as a safety net in accidents, they may not always be sufficient to cover the full extent of damages and losses. Car accidents can result in severe injuries, extensive property damage, and substantial medical expenses that may surpass the coverage limits outlined in the insurance policy.

Several scenarios can unfold when a car accident claim exceeds insurance policy limits. In negotiations with the at-fault driver’s insurance company, it is unlikely that the settlement will exceed the policy limits. Insurance companies are generally not obligated to pay more than the coverage limits specified in the policy.

However, if you decide to pursue a legal claim against the at-fault driver or other responsible parties, compensation can be recovered that exceeds individual policy limits. By making successful claims against multiple defendants, each with their insurance coverage, you may be able to aggregate the coverage limits to compensate for your damages fully.

an experienced lawyer will help you maximize the car accident settlement

Options If Damages Are Higher Than Insurance Limits

When a car accident claim surpasses insurance policy limits, exploring all available legal options is essential to seek fair compensation for your damages. Here are some potential avenues to consider:

Suing the At-Fault Parties Personally

If the damages exceed the policy limits, you may personally file a lawsuit against the at-fault parties. This legal action aims to hold the individuals accountable for their actions and recover the additional compensation needed to cover losses.

However, the success of such lawsuits depends on the defendants’ personal assets and their ability to pay the judgment.

Underinsured Motorist Coverage

Another option is filing a claim under your insured motorist (UIM) coverage. UIM coverage provides additional protection when the at-fault driver’s insurance policy limits are insufficient to cover your damages. This coverage allows you to seek compensation from your insurance company up to the limits specified in your UIM policy.

Bad Faith Claims

Insurance companies may sometimes act in bad faith by failing to settle a claim within the policy limits reasonably. If you believe your insurer has acted in bad faith, you may have grounds for a bad faith claim. This legal action holds the insurance company accountable for its actions and seeks additional compensation beyond the policy limits.

It’s important to consult with an experienced personal injury attorney to understand the best course of action based on the specifics of your case. An attorney can guide you through the legal process, assess the viability of your claim, and advocate for your rights to secure fair compensation.

Can a Car Accident Settlement Go Beyond Policy Limits?

Settlements rarely exceed policy limits when negotiating with the opposing party’s insurance company. Generally, the insurance company isn’t obligated to pay more than the coverage limits specified in the policy.

However, if you pursue legal action against one or more parties responsible for your injuries, the potential for settlements exceeding individual policy limits increases.

The Importance of Legal Help

Dealing with the aftermath of a car accident can be daunting, especially when faced with the possibility of exceeding insurance policy limits. In such situations, seeking legal assistance from a skilled personal injury attorney is crucial.

A Los Angeles car accident attorney can navigate the complexities of your case, assess your damages, and advocate for your rights to maximize your compensation.

During your consultation with an attorney, provide all relevant details and documentation related to your accident. This will help the attorney evaluate the strength of your case and provide tailored advice based on your unique circumstances.

Remember, time is of the essence when pursuing a personal injury claim. Statutes of limitations restrict the time you can file a claim, so it’s important to act promptly to protect your rights.

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