Auto Insurance Coverage — How Much Liability And Medical?
I got a couple of questions about about auto insurance coverage. Namely, what’s the best amount of liability and medical coverage to select. 1) For the liability, I know it’s wise to get the best liability that one can afford to cover your assets. But how about if one also gets umbrella coverage. For example, if one gets an umbrella coverage at a $2 million limit and the liability limit for the auto insuarance is $300,000 or $500,000, does it make sense to select the $500,000 or is it better to select the $300,000 limit since the umbrella coverage would kick in? 2) for medical, is this redundant coverage and not needed because wouldn’t the liability portion also cover medical expenses? Or is it wise to get this, for example, if a passenger is not insured (no health insurance), so the medical part would help out in that case?
Thanks.
November 6th, 2009 at 2:18 am
1 – liability coverage is very cheap. The difference between the 300 and the 500 is probably only dollars a year.
When you start an umbrella policy, the insurance company has certain limits that you have to have. Usually it is the highest that they have – (ie 25, 50, 100, 300, 500). They wont cover you until the first part has been attained – ie if they want you to have a limit of 500K and yours is only 300K they wont cover you until you hit the 500. (you would be responsible for the difference). I’m sure you have a respectable agent that would ensure that you are adequately covered to prevent this from happening.
As for the medical coverage – this would cover passengers in your car etc… There would also be a threshold that you would have to meet prior to the umbrella policy picking up the tab. I would recommend getting this coverage because it, like liability, is also very cheap.
November 6th, 2009 at 2:18 am
1)Each company will have a minimum limit of liability for each type of policy that the umbrella covers. In my company for instance, the umbrella requires 250,000/500,000 in liability coverage for autos. It would be redundant to add more b/c the umbrella will kick in on any claims higher than 250,000/500,000. Find out what the minimum amount of liability is for your company and set it there.
2)Edit* Sorry to change my answer, but I realized that really this really varies state to state and didn’t want to give you bad advice. An insurance agent in your state will be able to give you a much more accurate answer than you will find here.
Personal Umbrella Policies or PUPs are fantastic for anyone with assets over $500,000. By nature they are fairly comprehensive and extremely affordable for the coverage they offer.
Hope this helps!
November 6th, 2009 at 2:18 am
please try this
Thehelp