by Guest » Sat Jul 14, 2012 12:21 pm
I only have personal injury liability coverage for $30k, but the other party has claimed $75,000 for injuries. Will my insurer drop my auto insurance coverage? Or can I fight for it? Will the insurer cover my court charges in that case?
Posted: Sat Jul 14, 2012 01:52 pm Post Subject:
Will my insurer drop my auto insurance coverage?
A carrier cannot just drop coverage.
Or can I fight for it? Will the insurer cover my court charges in that case?
You are getting WAY ahead of yourself and off track.
Your carrier will do everything in their power to settle the claim for your policy limits or less.
Is that $75k an initial demand from an attorney? If so, it's almost always _way_ inflated. Also, almost always the other person's attorney will settle for your policy limits. Your carrier may feel that the claim is not worth $30k and offer less. If they offered the $30k there is a 99.9999% chance that the attorney would take it and have the client sign a release (nothing is paid by our carrier without a full release being signed... they have an obligation to settle the matter for within your policy limits). If the attorney does not want what your carrier offers then the attorney many file suit. Almost always, policy limits are not reduced by defense costs... so your carrier would hire an attorney to defend you in the matter. Almost all cases settle prior to a judge/jury makes a decision on what is owed (there is a big and long process before it gets that far).
What you need to do is call your adjuster and ask for the status of the situation. How much are the other person's medical bills (they could be $5k in which case your $30k could easily settle the claim... they could be $25k in which case the adjuster should be offering your $30k to settle the claim).
Look into higher limits and the cost of that. Doubling your liability limits may cost very little. It won't help with this claim but it will better protect you in the future. $30k is not too bad but check on the cost of higher limits and decide if you may want to increase it.
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