Car crashes impact every community. According to data collected and published by the California Highway Patrol (CHP), more than 275,000 people are hurt in traffic collisions in the state on an annual basis. Following a serious automobile accident you need full financial compensation to pay your bills and support your family.
This raises an important question: What happens if your legal claim exceeds the insurance policy limits? The short answer is that the policy amount is typically the most an insurer has to pay, but there may be other options to recover compensation. Here, our Los Angeles car accident lawyers provide a more detailed overview of what happens if a car crash claim exceeds the policy limits.
Damages You Can Recover In A Car Accident Claim
As a starting point, it is crucial that you understand the types of damages that can be recovered in a motor vehicle accident claim. Depending on the specific circumstances of your case, you may be eligible to recover financial compensation for the following types of damages:
- Automobile repairs;
- Emergency room care;
- Other medical bills;
- Physical therapy;
- Loss of current and future income;
- Pain and suffering;
- Disfiguring injuries;
- Permanent impairment; and
- Wrongful death of a close relative.
California is an at-fault car crash state. The party responsible for an accident is liable for the resulting damages. In the overwhelming majority of cases, car accident claims are made against the at-fault party’s insurance policy.
An Overview Of The California Insurance Requirements
As explained by the California Department of Motor Vehicles (DMV), automobile insurance coverage is “required on all vehicles operated or parked on California roads.” Motorists in California must obtain a liability policy to ensure that coverage is available if they cause an accident. Motor vehicle insurance policies do not provide infinite coverage. Instead, a policyholder is insured up to a certain predetermined amount based on a few different factors—the most important being the premium paid. California requires the following minimum mandatory liability coverage:
- $15,000 for injuries per person;
- $30,000 for injuries per accident; and
- $5,000 for property damage.
Drivers can (and often should) purchase liability coverage beyond the minimum mandatory requirements. Though, many drivers only have the minimum required 15/30/5/ liability coverage in California.
What Is An Insurance Policy Limit?
Simply defined, a policy limit is the most a particular insurance policy will pay out. As an example, imagine that you were hurt in an accident with a distracted driver in Los Angeles County. An investigation confirmed that the other driver was solely responsible for the crash. If that driver had the mandatory minimum 15/30/55 liability coverage, the most you could claim from their policy is up to $15,000 for per person in injuries and $5,000 for property damage.
Your Three Primary Options For Collecting In Excess Of A Policy Limit
If you were seriously injured in a car accident in California, your damages may be well in excess of the at-fault party’s policy limit. Here are your three basic options for seeking compensation in excess of an insurance policy limit after an auto accident:
- A Lawsuit Against the At-Fault Party: You may be able to collect compensation beyond the policy limit directly from the at-fault party. While this is a viable option in some limited cases, it is usually very difficult. Often, the party at fault for a car accident is a driver. They may have little (if any) personal assets from which you can collect.
- A Claim Under Another Insurance Policy: You are not restricted to pursuing car accident compensation from a single insurance policy. If multiple parties bear liability for your crash, you can bring claims against multiple insurers. Further, if you have uninsured and underinsured motorist coverage (UM/UIM), you have a path to additional compensation through your own insurer.
- A Bad Faith Lawsuit Against the Insurer: Finally, there are some circumstances in which you can sue an insurance company for damage beyond the policy limit. If your initial policy limit claim was delayed or denied in bad faith, the insurer could end up being liable for the full extent of your damages—even if those damages are in excess of the policy limit.
Get Help From A Los Angeles, CA Car Accident Lawyer
At Fisher & Talwar, our California auto accident attorneys are skilled, solutions-focused advocates for victims and their families. If you have any questions about auto accident claims that exceed insurance limits, we can help. Call us now or use our online contact form for a free review of your case. We represent auto accident victims in Los Angeles and throughout Southern California.