What Happens After Maximum Liability to Person at Fault?
All individuals who pay premiums for car insurance coverage are curious to know how much the insurers will actually pay when an accident takes place. This article will clarify and discuss the obligations indicated in your car insurance policy when the accident is entirely your fault or only to some extent.
First, let us classify in what circumstances insurance companies are obliged to pay. If you are legally liable for physical injuries or damages to another person’s property, the car insurance policy will cover you just by being the owner of the vehicle that caused the accident. If there are criminal proceedings resulting from the accident, the insurer will pay for attorney’s fees and other related legal fees. They will also be part of the negotiation process for the settlement to compensate the victim of the crash or owner of the destroyed property. However, if the damages were a result of malicious, fraudulent, or intentional acts, then the insurance carrier will not shoulder the expenses.
Also if the damages were caused by a vehicle that was used to transport property or people for profit, these are not covered by your personal car insurance. These are part of the exclusions. The insurance policy usually indicates what the insurance providers will or will not cover.
We have established that insurance providers will cover the expenses brought about by accidents caused by an insured vehicle. In addition, there are other costs that insurers are willing to pay for. All the expenses for your defense, in case a lawsuit is filed against you, will be taken care of by the policy. If the amount of damages has incurred interest while waiting for the court’s decision, the insurer will pay for it so long as it does not exceed the maximum liability. This also includes payment for appeal bonds, attachment bonds, and others. You could also charge other related expenses to your insurer. Reasonable requests for reimbursement are often approved as long as it is still within your policy limit.
The term pertaining to the maximum amount in dollars which will be paid for by the insurance policy is called the limits of liability. Review your policy. The limits of liability can be found on the sheet entitled “Declarations” in your auto insurance policy. This page should contain all kinds of coverage that you have, their corresponding limits and deductibles. It should also include information on discounts that the policyholder can qualify for and the rate of the premiums.
To further understand the limits of liability section, it simply says that no matter how severe the accident was, how many persons were affected by it or how much property was destroyed, your insurer will not pay a cent over the stated amount in the Declarations. This is on per individual and per accident basis. Your insurer will not bend its decision regardless of the circumstances involved. In short, the maximum amount is just that. No more, no less.