Many of the companies that I represent will give you a discount if
you have liability limits that are higher than the state minimums. You
also save money because you don't have to worry about paying out of
pocket for someone's injuries that go above your limits. However, when I ask a potential client what their liability limits are on the car insurance, I usually get the "dear in the the headlights" stare at the other end of the phone. Many people have no clue what their limits are - much less know what those limits are for. Let me explain:
You are usually assigned split-limits for liability, for example: 30/60/15. The first number represents your limits for bodily injury liability for a single person; if you cause an accident and it does bodily injury to someone, the max that they can receive from your insurance is $30,000. The second number is for the entire accident, so let's say that 2 people got hurt in an accident that you caused; one person could receive $40k and the other $20k. The last number represents the limit for property damage that you are liable for. For example if you wreck someone's car or drive through a house (let's hope neither happens!), then your insurance company will pay up to $15k for the damage.
If you currently carry the state minimums (like 15/25/25) then you are missing out on a discount upon renewal for having higher limits and you are also leaving yourself open to paying someone's medical bills if they go over your limits! If you have a mortgage, I recommend 50/100/50 limits because you have more to loose! If you put a few people in the hospital because you were texting and driving and they win a lawsuit against you for $80,000 for bodily injury, damages and loss wages, your state-minimum policy will be leaving you paying the difference! If you own your home free and clear, I reccomend 100/300/50 limits or the big one at 250/500/100. The adjusters will be looking at any assets that you own to pay off the claim against you and if you own your home then that can be very bad news for you!
Overall, I'd say it just depends on what you can afford. For some people, the monthly payments for a policy for double the coverage on liability is too expensive and that is understood but hopefully this sheds a little bit of light on your options. Call me at 877-50-MyHome Ext 8481 and see what I recommend for you!
