Posted on Thursday, October 24th, 2024 at 5:07 pm
While state law requires all Utah auto insurance policies to include no-fault coverage, which is limited, to recover full compensation after an accident, you likely need to file a liability insurance claim against the other driver. However, insurance companies won’t pay more than a policy’s limits in a settlement. This fact raises a crucial question: What happens when a car accident claim exceeds insurance limits? Let’s explore the answer in detail.
What Are Utah’s Minimum Car Insurance Requirements?
Utah’s minimum auto insurance requirements set the floor for your compensation after a car accident. Starting Jan. 1, 2025, the minimum auto insurance requirements in Utah are:
$30,000 in injury coverage for one person hurt in a crash
$65,000 in injury coverage if multiple people are hurt in a single crash
$25,000 in property damage coverage per accident
Utah law also requires all auto insurance policies to include $3,000 in Personal Injury Protection (PIP) coverage. PIP coverage provides no-fault coverage for medical expenses after an accident, no matter who caused it.
Why do these minimum insurance requirements matter? Because in the vast majority of cases, an insurance company won’t pay more than a policy’s limits in a settlement. Knowing the minimum amount state law requires can help you set your expectations for compensation after a crash. It can also help you know when it’s appropriate to look for other sources of compensation.
What Is a Policy Limits Settlement?
A policy limits settlement, which is a car accident settlement for the maximum amount an insurance policy covers. So, if the at-fault driver’s policy limit is $100,000 in bodily injury coverage, the insurer will pay the most, which is $100,000.
Why do insurance companies place limits on their policies? Because their business model relies on assessing risk and collecting more premiums than they pay out in claims. By limiting how much they pay for individual claims, insurers ensure the profitability of their businesses. Unfortunately, this can make it difficult for injured parties to recover full and fair compensation after a crash.
How Often Do Auto Accident Settlements Exceed the Policy Limits?
By definition, insurance policy limits define how much an insurer must pay for a single claim. Therefore, an auto accident settlement will never exceed the limit for any individual insurance policy. However, if multiple parties share the blame for a collision, the total settlement amount might exceed the limits for each individual policy.
Sometimes, an individual or organization might have an “umbrella” policy for cases where the standard policy isn’t enough to cover the losses from a crash. The total settlement might exceed the liable party’s usual policy limits in these scenarios. Talk to a lawyer if you have questions about this issue.
Will an Insurance Company Pay More Than a Policy’s Limits?
No, an insurance company definition ally will not pay more than the limits of a given policy. Insurance companies have no legal obligation to pay more than a policy’s limits. There are only a handful of situations where an accident victim might ultimately recover more from the insurance company than these limits. One possible circumstance is where an insurance company might commit fraud and open itself to liability separate from that involving the accident itself. In this situation, the insurer’s intentional wrongdoing might make it liable to you for further damages. Call a lawyer immediately if you suspect an insurance company has intentionally committed fraud against you.
Other Options for Recovering Compensation After an Accident
If your losses after a crash exceed the at-fault driver’s policy limits, you will likely need to find other ways to recover compensation. Some options for recovering additional compensation after a Utah car accident include:
File a Lawsuit Against the At-Fault Party: You can sue the at-fault driver personally to recover compensation from their personal assets. However, drivers with low policy limits typically don’t have many assets, so this option isn’t always feasible.
Pursue a Claim Under Your Auto Insurance: Policies like underinsured motorist (UIM) coverage can help cover losses exceeding the at-fault driver’s insurance limits.
Seek Compensation from Other Liable Parties: In some cases, other parties, such as employers, vehicle manufacturers, or government entities, might share liability for an accident. If that applies to you, you can file claims against them to seek additional compensation.
Negotiate a Payment Plan with the At-Fault Party: If the at-fault driver has limited assets, you might arrange a payment plan to recover the amount owed over time.
Consider a Settlement for Partial Compensation: If the at-fault party has minimal assets, settling for a reduced amount might provide quicker relief and avoid lengthy litigation.
File a Claim Against Your Health Insurance: If your medical bills exceed the at-fault party’s coverage limits, your health insurance might help cover additional expenses related to the crash.
The most important thing you can do under these circumstances is to work with an experienced car accident attorney. They can identify all available sources of compensation, build a strong case, and ensure no potential recovery option is overlooked.
How We Can Help If Your Losses Exceed the Liable Party’s Policy Limits
At London Harker Injury Law, our Utah car accident lawyers understand how stressful it is when your losses exceed the at-fault party’s insurance limits. Our team is here to help you explore every possible option for recovering the compensation you need. We’ll carefully investigate your case, identify other potential sources of compensation, and determine whether the at-fault party has additional insurance or assets. We can pursue claims against other liable parties, such as employers or manufacturers, to maximize your financial recovery if necessary. Check out our recent case results to know why you should trust us.
Our attorneys also can evaluate your insurance policies, like underinsured motorist coverage, to help you recover the compensation you need. We’ll fight aggressively to secure fair compensation for your injuries and losses if litigation becomes necessary. With our guidance, you can focus on your recovery while we handle the details of your case. Call 77CARCRASH now or complete our contact form for a free case review.
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