Okay, folks... a lot of you are impressing me with your knowledge of auto safety and auto insurance. We have some smart folks out there so I'm going to try to challenge you a bit (especially after that soft one I tossed you last night).

Okay... ready ?

Clo carries liability limits of 50/100/50 on her 2007 MCSC (I upgraded you, Clo).

Clo runs a red light and hits a 2008 Porsche 911 GT2 valued at $180,000. The Porsche is declared a total loss. The driver of the Porsche and his passenger are both injured. The driver has a bodily injury claim of $20,000. The passenger's bodily injury claim is for $65,000.

What does Clo's insurance company owe for this accident ?

By the way, two more things:

Clo is fine, she's a tough gal.

Clo, you need to increase your liability limits, Dear. You're going to be sued.

 

$120,000

 

$120k sounds right to me as well. $50k property + $20k driver + $50k passenger. (Just to show that I actually thought about it. )

 

Assuming that the "50/100/50" means as following:

$50K for property,
$100K for driver, and
$50K for each pax

Then, yes, $120K is all the Porsche owner and his friend/relative will get, and, unfortunately if they can afford such a car, they can afford to sic their lawyers on poor Clo....

I take the insurance company won't help defend Clo, after paying off the $120K?

 

I think the $100k is a cap on liability for all persons in the accident, not a driver cap. Either way, since the total for the driver and passenger is $85k, it's not met.

 

$135,000 will be my guess-timate.... poor poor Clo, don't ever drive to Vegas!

 

50 injury per person
100 total injury for all persons per accident
50 property damage

20 for the driver, 50 for the passenger, 50 for the car

 

Don't assume that. It depends on the situation. The insurance company is more likely to defend their policyholder in a bodily injury liability suit when those limits have been exhausted than they would be in a suit for property damage with exhausted limits.

However, each situation is different and many factors weigh into the decision to represent or to not represent.

 

Okay, not too many folks answered this one. Either that's because it stumped some folks or maybe once the few of you that did answer got it right, nobody else bothered.

Anyway, the question is easy if you understand what the 3 numbers on your liability limits represent:

50/100/50

50 = Bodily Injury Liability per person.
100 = Bodility Injury Liability for all persons.
50 = Property Damage Liability for all property.

By the way, some people think that these limits are for a year or six month policy period. No... they are for each accident, regardless of how many you have in which your are at-fault.

So, applying the limits for Miss Clo's accident, her insurance company will pay $50,000 for the totaled Porsche. They'll pay the $20,000 for the driver's injury claim and $50,000 for the passenger's injury claim. Since the $70,000 in total injury claims is under the "all persons limit", we're okay there.

So, 50 + 50 + 20 = $120,000.

Good job, folks !

By the way, in today's world, you really shouldn't be carrying liability limits less than 100/300/100.

 

Ok, give that TX is about to up the lower limit to 25/50/25. Say I go hit a new Camry thats 30K. I'm on the hook for 5K? What about repairs to my vehicle?

BTW, I checked my policy. 250/500/200

 

Lord knows that is true. The most common car where i am seems to be the Lexus RX400 or whatever it's called.

 

Whatever you do, make sure you have un-insured/under insured coverage.

 

Just a call-out to CR&PW&JB for posting these informatives topics... keep them coming!

Thanks!
Ed

 

I was actually wondering about this a couple months ago when I signed up for auto insurance. Given that I'm a 20 year old college student, the agent said that limits of 100/300/100 may be overkill since I'm on the policy by myself and don't really have any seizable assets. Since this was my first time dealing with auto insurance (the MINI is my first car) I had no idea and simply told the agent to go with whatever is recommended. I ended up getting 100/300/100 anyway simply because it resulted in the cheapest premium, but what would have been your advice in this situation? My deductibles are $500 for both comprehensive and collision if that matters.

 

+1

We need to centralize the questions/answers somewhere. I enjoy reading the humor and banter back and forth, but in the end...I want to read the question, ponder it, and follow up with the answer.

And keep it for future reference.

 

In this scenario, yes, you will be liable for the remaining $5,000 that your limits did not cover.

Repairs to YOUR vehicle depend on your Collision coverage. If you carry it on your policy, you're responsible for your deductible only. The insuracne company is responsible for every penny after that... even if you have a $400,000 car. Although I'd hate to see your premiums.

 

A topic for a future question.

BTW, not all States offer both UM and UIM.

 

Your agent says those limits are "overkill" because what's anyone going to sue you for, your good looks ? Easy for him to say, he won't be the one going to court. IMO, not having many assets is not an excuse to invite a lawsuit by carrying low limits. After all, if you have a job, you have assets that can taken from you.

Re: your deductibles. I would go with a lower Comp deductible if I were you. Two reasons:

1. Comp coverage is relatively cheap. Lowering your deductible to $100 or $200 will not be very expensive.

2. So many types of losses fall under the comp coverage. Stolen veh, vandalism, fire, road debris, hail damage, flood, falling object, etc.

 

Thanks, Ed (and Tiggy). Sorry, no question last night. I'm fighting a cold and it's winning, so I went to bed at 9:15.

I'll get back to them.