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Can an Auto Accident Settlement Exceed Insurance Policy Limits?

Yes, it is technically possible, but only in some cases. Policy limits will determine how much an insurance company will pay out for a car collision. As a result, the injured driver faces additional challenges if their claim happens to exceed what’s stated in their policy limits. As a general rule, it’s uncommon to collect compensation for an injury beyond the scope of your insurance policy, but every case is different. To discuss your unique situation, it’s recommend you speak with an auto injury attorney in Southwest Virginia. They will know better how your policy limits impact your claim.

Southwest Virginia auto accident attorney

Your car insurance policy has requirements for specific amounts of coverage. When your injuries are such that they will far exceed those limits, you may wonder what recourse you have to secure adequate compensation. Here are some ways you can pursue compensation beyond your insurance policy limits.

1. Sue the At-Fault Driver

When your claim exceeds the policy holder’s insurance limits, you can sue the at-fault party directly to make up the difference. But even if your case is successful, it’s important to note that the defendant may simply not have enough assets to pay out those remaining damages. This could be a futile option if the at-fault driver has little to no assets.

2. Sue Multiple Defendants

Multiple at-fault defendants involve several insurance policies that you could potentially be compensated from. Defendants can be held jointly liable for damages, with the award from each insurance policy being in proportion to the degree of responsibility of each defendant.

3. Umbrella Policies 

Umbrella policies are like a safety net, giving you extra coverage above and beyond what your policy limit is for your primary coverage. These umbrella policies are typically held by commercial and corporate entities, but it’s not uncommon for individuals to carry this type of policy as well.

Once you have exceeded your primary policy limit, that umbrella coverage would kick in to potentially cover additional amounts paid out for the claim. Every policy is different, though, so always review what your umbrella policy covers specifically.

4. Insurance Bad-Faith

Insurance companies are not there to make friends. They are there to make money, and paying you more than they have to is simply not in their best interests. To achieve their goal of saving their company money, they may take part in bad faith practices as part of the settlement proceedings. If your insurance company is able to settle your claim reasonably but won’t, they could be guilty of acting in bad faith.

If your auto accident lawyer in Southwest Virginia is able to prove such bad faith practices, your insurance company may have to cough up the total damages awarded, no matter what your policy limit is.

Contact Altizer Law

Got a question about auto collision settlements and what you can do to be compensated beyond your limit? Our team of Southwest Virginia auto accident attorneys can give you a free, no-obligation consultation when you contact us at 540-345-2000.