What Happens When Auto Insurance Limits are Exceeded?

You buy an auto insurance policy anticipating that it will provide coverage for you when you need it the most. However, that is not always the case. There are times when damages may exceed an insurance policy’s claim limits.

Each claim is different, and several unique situations can make interpreting some auto insurance policies challenging. However, if you are in an automotive accident and the financial losses are more than yours or the other person’s auto insurance policy limit allows, you may be wondering—or panicking about— what options you have to cover all the damages or injuries.

The main question here is how you will be able to compensate the victim or receive compensation if the auto insurance limits are insufficient.

Florida Auto Insurance Laws

Nearly every state requires drivers to have some level of auto insurance. In Florida, there are two types and amounts of required coverage:

  • $10,000 in personal injury protection (PIP)
  • $10,000 in property damage liability

However, drivers can elect to purchase more coverage than these two bare minimum requirements and, in many cases, choose to do so because accident damages may exceed the above coverage amounts.

While insurance companies are required to pay up to the entire coverage amount as outlined in their policies, if the expenses or damages exceed the policy limit, you will likely need to explore other options, such as filing a personal injury claim.

Exceeding Auto Insurance Limits

Damages can quickly exceed the limits of an auto insurance policy, and the insurer won’t pay out more than what is outlined in the policy. However, Florida no-fault auto insurance laws provide specific options for individuals whose damages exceed a policy’s claim limit, including filing a personal injury lawsuit.

Shop The Best Auto Insurance Coverage for You

Auto accident damages can range from minor with a superficial paint scuff to fatal. Because it is an accident, it is unpredictable, which is why having more coverage is often better than having the minimum auto insurance coverage, especially to help avoid filing or having a personal injury lawsuit filed against you.

When you purchase insurance, you shift the price of a potential misfortune to the insurance company in exchange for payment, known as the premium. At GWK Insurance, we make it a point to educate, inform, and assist our clients in the process of making the right insurance choices. Contact us today to learn how we can help you shop for the best auto insurance coverage for you.