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 the other driver's fault or your own, the decisions you made when renewing your automobile insurance coverage months before the accident will significantly impact how the accident will affect your life.
Bodily injury/property damage coverage protects you from claims from other parties concerning accidents that you cause. 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 caused by you, you are covered up to $15,000 for injuries to each person, up to a cap of $30,000 for injuries to multiple persons in the accident. Accordingly, if you injure one person, you are covered up to $15,000, and if you injure more than one person, the coverage is $15,000 per person, but up to a maximum of $30,000. So, if three people are hurt, your insurance company would have to pay each injured person his or her fair share depending on the injuries, but only up to $15,000 for any one person and $30,000 total. In addition to bodily injury coverage, you are also required to have coverage of at least $5,000 for damage to property in any one accident.
It is often advisable to carry substantially more than the minimum coverage. It is certainly foreseeable that the $15,000 for any one person and $30,000 total for any one accident would be insufficient to satisfy a claim for a serious bodily injury to one or more persons should you cause an accident. Similarly, a property damage claim could easily exceed the $5,000 minimum coverage.
In the event that either bodily injury or property damage is exceeded, the people injured in the accident could sue you and try to collect from your personal assets to recover their damages that are in excess of your insurance. For example, if you only have a $15,000/$30,000 policy and cause $100,000 of bodily injury to one person, you can be pursued personally for $85,000 of damages.
As such, it is important to consider purchasing more than the minimum coverage from your insurance provider. People with moderate amounts of assets will often purchase bodily injury protection of $100,000/$300,000 and it is not uncommon to see high asset individuals have up to $1,000,000 of coverage.
You can also consider obtaining an umbrella insurance policy, which provides additional liability coverage above and beyond the coverage provided in your automobile policy.
From a legal standpoint, it is advisable to have enough insurance coverage so that, if you do cause an accident and serious injuries result, your insurance will be sufficient to pay for the damages and your personal assets will not be at risk.
Tim Rayne is the author of numerous publications on Personal Injury Law and is a graduate of the Temple University Beasley School of Law's Master's in Trial Advocacy Program. Tim can be reached at http://www.macelree.com/traynelaw.
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