A Lawyer’s Guide to Purchasing Automobile Insurance – Part One – Liability Coverage
You are driving through an intersection when, suddenly, you hear the screech of tires and feel another car crash into yours. Whether the accident was your fault or the other driver’s fault, the decisions which you made when you purchased or renewed your automobile insurance months before will significantly impact how the accident will effect your life.
In this four part series, I will give you a Personal Injury Lawyer’s Guide to Purchasing Automobile Insurance. This first part deals with Bodily Injury and Property Damage Liability Coverage which protects you from claims from other parties concerning accidents that are your fault.
Under Pennsylvania law, you are required to carry Bodily Injury Liability Coverage of at least $15,000/$30,000. What that means is that in an accident that is your fault, you must have coverage of at least $15,000 for each person injured up to a cap of $30,000 total for multiple people injured in an accident. So, if you injure one person and have the minimum Liability coverage, your insurance company would be obligated to compensate the injured person up to $15,000. If you injure multiple people, your insurance company would be obligated to pay out up to $30,000 in total. So, if three people were hurt, they could claim compensation from your insurance company of up to $15,000 each and a total of $30,000.
In addition to being required to have Bodily Injury Coverage, you are also required to have Property Damage Coverage of at least $5,000. Property Damage coverage pays for damages which you cause other than injuries to people, such as damages to other vehicles, fences, road signs, buildings, etc.
It is often advisable to carry substantially more that the minimum amount of coverage required by law. It is certainly foreseeable that the $15,000 coverage for any one person and $30,000 coverage for any one accident would be insufficient to satisfy a claim for serious bodily injuries to one or more persons. Similarly, a Property Damage claim could easily exceed the $5,000 of minimal coverage.
In the event that either Bodily Injury or Property Damage caused by an accident exceeds the amount of insurance coverage, the injured people could sue you and try to collect from your personal assets to recover the damages that are in excess of your insurance. For example, if you cause an accident, only have a $15,000/$30,000 Bodily Injury insurance policy and the injuries to one person require compensation of $100,000, that injured person could seek compensation of $85,000 from your personal assets.
Because of this possibility, it is important to consider purchasing substantially more than the minimum coverage required by law. People with moderate amounts of personal assets should consider having at least a $100,000/$300,000 Bodily Injury Coverage and Property Damage Coverage of at least $25,000. High asset individuals should consider higher coverage and talk to their insurance agent about an “Umbrella” liability policy which would provide liability coverage for automobile accidents or other accidents above and beyond the coverage in an automobile insurance policy.
From a legal standpoint it is advisable to have enough insurance coverage so that, if you cause a serious accident, an insurance company will pay the victims, rather that the money coming from your personal assets.
Tim Rayne, Esquire – MacElree Harvey, Ltd. 211 E. State Street, Kennett Square, PA 19348 (610) 840-0124 trayne@macelree.com
Tags: attorney, automobile insurance, car insurance, lawyer, liability coverage, Pennsylvania law, personal injury
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