Should uninsured liability match personal liability?
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Asked March 8, 2011
Uninsured liability is designed to protect you and those who are dependent on you in the event that the person who is at fault does not have insurance. In such a situation, your insurance would only cover people for whom your are directly responsible for. Most insurance companies will advise you to carry equal amounts of uninsured and liability coverages, but you will probably decide to carry more personal liability as the risks are higher should you have to file a claim.
Personal liability insurance covers any liability property damage or bodily injury claims against you, or incidents that are deemed to be your fault. This includes persons riding in your vehicle as well as the people or property affected by your incident. As you can see, it is quite possible for your liabilities to include far more in the way of both property and potential damages. Personal liability is used in situations where you can be assumed to be at fault and therefore responsible for all of the liabilities involved, so it tends to be somewhat higher than uninsured coverage, which merely protects you against the other person's oversights.
Umbrella liability policies offer another option. An umbrella liability policy can be used for almost any type of claim, and takes effect after the policy it the claims is filed against has been maxed out. This would allow you to carry lower individual liability coverages for your home and vehicle, but have the umbrella available to back those policies up if a worst case scenario develops. Remember, an umbrella policy is used in conjunction with, not in place of, other liability coverages.
Answered March 8, 2011 by Anonymous