OT: Increasing liability from 1M to 2M

[TimNDansMom]

Our house and car insurance comes due this month and my insurance agent said that people are starting to increase their liability coverage. We currently have $1M on both. The agent said it would be an increase of approx. $15 +tax on the home policy and $60+tax on the car policy which is for 2 cars.

I just wondered what others had for liability coverage and/or thoughts on increasing it.

 

[A&CsMom]

I strongly recommend that people make this change. If you cause an accident and someone is seriously hurt your car insurance only covers you up to $1M - you are personally liable for any amounts recovered above that. Usually when the award exceeds $1M it is for things like future care and lost wages for life which in this day and age can easily exceed $1M in a serious accident where someone suffers catastrophic injuries. You are also responsible for getting your own lawyer to defend you for amounts above the liability limit, which means legal fees as well. Of course that could happen if you liability is $2M, but likely less often.

By the way, I'm not a lawyer -- maybe if there is one on the boards they can chime in on what they think.

 

[surfer_ed]

I think I shared this story before but I was in an accident several years ago when I lived in NF and the person claimed that they could never work again and sued me for 1,030,000.

No damage to my car and slight damage to hers but she had whip lash. I knew it was going to be an issue when she jumped out of her car and started rolling around on the ground yelling "Oh my neck, oh my neck"

As it turned out, insurance company hired a PI and it went to court. She was claiming allot of things that were not true. For instance back pain prevented her from going to work but not on a ski trip or teach aerobics on the side.

I know she got hurt and I felt bad but she was trying to take me to the cleaner.

Off course my insurance company handled it and I didn't have to get that involved but for several years I was worried about being o the hook for $30,000. It was eventually settled for less than $100,000

For less than $50 a year I got 2 million ever since.

 

[runner26.2]

There are a number of very good reasons to increase you insurance to $2 million, including peace of mind.

For the very nominal increase in premiums it is worth it.

 

[Newcastle]

I strongly recommend that people make this change. If you cause an accident and someone is seriously hurt your car insurance only covers you up to $1M - you are personally liable for any amounts recovered above that. Usually when the award exceeds $1M it is for things like future care and lost wages for life which in this day and age can easily exceed $1M in a serious accident where someone suffers catastrophic injuries. You are also responsible for getting your own lawyer to defend you for amounts above the liability limit, which means legal fees as well. Of course that could happen if you liability is $2M, but likely less often.

By the way, I'm not a lawyer -- maybe if there is one on the boards they can chime in on what they think.

A&CsMom,

I understand that you aren't a lawyer but you seem to know a lot about the auto insurance sector. If you don't mind me asking, do you work in this field?

 

[minnie56]

We have had 2M for some time now...but one thing (okay lots) ticks me off about Insurance.

I had a leak invloving water w/bleach in it. It leached from my Laundry Room into my hall and has removed the colour from the Carpet needless to say! Two+ yrs ago, we had our 1st claim EVER in 35+ years..when our Daughter at University had her house there broken into and we claimed apprx $4,000 for her stolen goods. Now I am being told 'IF' I submit this claim for the Carpet...that the Insurance provider, ING..will likely up my rates and deductible as well as 'POSSIBLY' not even offer me Homeowners Insurance upon renewal time! Talk about being between a rock and a hard place! Insurance is there as a safety net for such issues but you have to seriously consider using it!

Grrrrr, don't get me started!

 

[ferris198]

Is your quote for an increase on each policy, or is he quoting you on an Umbrella policy ?
I think $60.00 to increase liability on the auto is abit expensive. It used to be around $15.00 bucks or so to go from 1 - 2 million.
Ask about the cost of an Umbrella.

 

[A&CsMom]

A&CsMom,

I understand that you aren't a lawyer but you seem to know a lot about the auto insurance sector. If you don't mind me asking, do you work in this field?

I work for a lawyer who does personal injury (plaintiff side). With the knowledge I have I think the small premium is very worth it.

 

[eleanor]

We just bought a new car and had the 2 million on the insurance. It is worth the few dollars that you spend. By the way we got the PC insurance and it was 250.00 cheaper than the insurer we had for the old car. Needless to say we went with PC Financial

 

[dancin Disney style]

I had a leak invloving water w/bleach in it. It leached from my Laundry Room into my hall and has removed the colour from the Carpet needless to say! Two+ yrs ago, we had our 1st claim EVER in 35+ years..when our Daughter at University had her house there broken into and we claimed apprx $4,000 for her stolen goods. Now I am being told 'IF' I submit this claim for the Carpet...that the Insurance provider, ING..will likely up my rates and deductible as well as 'POSSIBLY' not even offer me Homeowners Insurance upon renewal time! Talk about being between a rock and a hard place! Insurance is there as a safety net for such issues but you have to seriously consider using it!

I've been there too, with an incident involving my car. I ended up paying out of my own pocket to prevent the possibility of being denied insurance in the future. Fortunately it was only $300 but considering all the money I pay year after year, and have never ever made a claim, I don't feel like I can count on them(the insurance company).

 

[ferris198]

I've been there too, with an incident involving my car. I ended up paying out of my own pocket to prevent the possibility of being denied insurance in the future. Fortunately it was only $300 but considering all the money I pay year after year, and have never ever made a claim, I don't feel like I can count on them(the insurance company).

If you paid for the claim you must have been at fault.
$300.00 is a small price to pay as most deductibles are at least $500.00 these days.
Insurance is there to protect people when they suffer a large loss. Unfortunatly people have taken advantage of it, and feel that anytime something goes wrong they should be paid for it. That is why premiums are so high.

 

[minnie56]

If you paid for the claim you must have been at fault.
$300.00 is a small price to pay as most deductibles are at least $500.00 these days.
Insurance is there to protect people when they suffer a large loss. Unfortunatly people have taken advantage of it, and feel that anytime something goes wrong they should be paid for it. That is why premiums are so high.

I do agree that abuse of the system has caused this ripple effect, however, paying hefty annual rates for our 3 vehicles, 1 Motorcycle, Homeowners insurance and my Husbands Commercial Business Insurance, it doesn't make me feel 'warm and fuzzy' when basically I am out of pocket when something befalls my home AND all I seem to do is pay Premiums??

I also understand there is a Gov't watchdog for Auto Insurance but not so to keep them honourable when it comes to Homeowners. Guess it adds up why Insurance is BIG business!

 

[ferris198]

Auto Insurance rates are regulated by the Financial Insurance Commision of Ontario. Insurers must file any rate changes 90 days prior to making an increase.
Home Insurance is based on the type of house, size,location ex.
With respect to your husbands commercial insurance, I would suggest he speak to his broker as the commercial market is softening is certain areas, and he should really see what he can do to get some savings.

 

[CanadianGuy]

From 2002 til 2006 I drove 'beater' cars. Cheap vehicles.. generally valued at 3k or less.

My 1991 Dodge Dynasty was stolen in 2004! I was shocked. Who would bother? And I didn't have theft coverage - WOOPS! Fortunately I got it back relatively undamaged. I put the ignition assembly back together myself... and drove away.

From that moment on I have had full coverage. Which turned out to be a blessing 2006 when my 1994 Jeep Cherokee was stolen (while locked and the alarm set) and burned by joyriders who used it to try to do a smash n' grab.

Two stolen cars in 2 years .. both of them over 10 years old and not worth stealing IMO... in NEW BRUNSWICK for pete's sake.

I was worried about the handling of that theft claim but my insurer was awesome. I had a rental car immediately and I had my claim settled within 5 days of recovery of the burned out remains of my truck. Brand new tires too! Made me so mad.

Then.. just last week - I was rear-ended in my newest car (2002 Jetta - in MINT condition) on my way to work. Believe me if it weren't for bad luck I wouldn't have any! Anyway, that driver has agreed to pay out of pocket for the repairs to my vehicle.. which were relatively minor .. 550$.

All this stuff with my 'luck' has me seriously thinking about upping my liability limit. I'm a very safe driver - no accidents (outside of that one) or tickets for 7+ years. But I'm probably going to up the liability.

Knox

 

[maryliz]

I agree with minnie56 ... you pay premiums year after year, never make a claim, and then when you finally do have one, they tell you that you should consider paying that $$$ out of pocket because it could bite you in the end. There aren't many car accidents that would leave you with less damage than your $500 deductible. And yes, blatant abuse is the cause, but it's not fair to those who have paid and paid premiums for years, and then end up paying again instead of using the insurance when and if they finally do need it in the future. They've pretty much got you coming and going.

 

[dancin Disney style]

If you paid for the claim you must have been at fault.
$300.00 is a small price to pay as most deductibles are at least $500.00 these days.
Insurance is there to protect people when they suffer a large loss. Unfortunatly people have taken advantage of it, and feel that anytime something goes wrong they should be paid for it. That is why premiums are so high.

Actually, the police found equal fault. It was a guy on a bike that hit the side of my van when he went through a red light and was on the wrong side of the road. The police said that unless he wanted to pay for the damage to my van then I should not pay for the damage to his bike.

However, after 2 weeks of not hearing from him he decided to try and get $800 out of me. He threatened me and said he would come to my house if I didn't pay. I called the insurance company and they said that by their system I would automatically be found at fault because I was in a car and he on a bike. The insurance did not care what the police had to say. So that left me having to pay out of pocket or risk being denied coverage in the future.

In the end I got the guy to agree to meet me at a bike shop and I would pay the bike shop directly. I told the bike shop the story and they were shocked about what this guy had tried to do to me and they gave me a bit of a break on the price and then after they fixed the bike they told the guy off.

As far as the $300 being a small price to pay, it was money that at that time I didn't have and it was a MAJOR hardship to borrow and repay. I do agree about people taking advantage of the system. I have NEVER made a claim of any kind in 20 + years of driving and 15 years of home ownership. So, hopefully you can see why I felt let down by the insurance company.

 

[mommytodarlings]

Actually, the police found equal fault. It was a guy on a bike that hit the side of my van when he went through a red light and was on the wrong side of the road. The police said that unless he wanted to pay for the damage to my van then I should not pay for the damage to his bike.

However, after 2 weeks of not hearing from him he decided to try and get $800 out of me. He threatened me and said he would come to my house if I didn't pay. I called the insurance company and they said that by their system I would automatically be found at fault because I was in a car and he on a bike. The insurance did not care what the police had to say. So that left me having to pay out of pocket or risk being denied coverage in the future.

In the end I got the guy to agree to meet me at a bike shop and I would pay the bike shop directly. I told the bike shop the story and they were shocked about what this guy had tried to do to me and they gave me a bit of a break on the price and then after they fixed the bike they told the guy off.

As far as the $300 being a small price to pay, it was money that at that time I didn't have and it was a MAJOR hardship to borrow and repay. I do agree about people taking advantage of the system. I have NEVER made a claim of any kind in 20 + years of driving and 15 years of home ownership. So, hopefully you can see why I felt let down by the insurance company.

As a former insurance broker, I have a huge problem with law enforcement giving insurance advice. The police decided it was equal fault, however insurance companies have fault charts that they go by to determine fault in a accident. Even if the police did not find you at fault, according to the insurance industry you could still be at fault.

There is a huge misconception out there about "no fault" insurance.

To the OP I agree with PP and would look at an umbrella policy. When I left the insurance industry (to be a SAHM) we were offering them to many clients and it gives you extra protection.

 

[dancin Disney style]

As a former insurance broker, I have a huge problem with law enforcement giving insurance advice. The police decided it was equal fault, however insurance companies have fault charts that they go by to determine fault in a accident. Even if the police did not find you at fault, according to the insurance industry you could still be at fault.

There is a huge misconception out there about "no fault" insurance.

I do understand what "no fault" insurance is and also how the insurance companys find fault. The police did not give any insurance advice at all. What I was trying to get across is that I needed help from my insurance company and they weren't there for me. I feel like all they do is take my money.

As a former insurance agent maybe you can explain to me why, someone can run a red light and hit the SIDE of my van, that puts me in any amount of fault?

 

[ferris198]

Actually, the police found equal fault. It was a guy on a bike that hit the side of my van when he went through a red light and was on the wrong side of the road. The police said that unless he wanted to pay for the damage to my van then I should not pay for the damage to his bike.

However, after 2 weeks of not hearing from him he decided to try and get $800 out of me. He threatened me and said he would come to my house if I didn't pay. I called the insurance company and they said that by their system I would automatically be found at fault because I was in a car and he on a bike. The insurance did not care what the police had to say. So that left me having to pay out of pocket or risk being denied coverage in the future.

In the end I got the guy to agree to meet me at a bike shop and I would pay the bike shop directly. I told the bike shop the story and they were shocked about what this guy had tried to do to me and they gave me a bit of a break on the price and then after they fixed the bike they told the guy off.

As far as the $300 being a small price to pay, it was money that at that time I didn't have and it was a MAJOR hardship to borrow and repay. I do agree about people taking advantage of the system. I have NEVER made a claim of any kind in 20 + years of driving and 15 years of home ownership. So, hopefully you can see why I felt let down by the insurance company.

Okay as one who has worked both on the company side, and as a broker, I can say that it doesn't matter what the police say, unless of course charges are involved.
The police do not determine who is at fault in an accident, they submit a report. And if it happened in the GTA they do not attend accident scenes unless it involves personal injury or damage is over $1000.00, they don't have time.
Don't know where your accident happened but that is how it goes here.
Fault determination is set out by FISCO (I believe), that is what insurers use to determine fault.
An accident will be determined to be 100%, 75%,50, or 25%.
If you are at all at fault, even 25% it will go on your insurance record if you report it, and it will stay on your record for 6 years, unless you have protection against a first claim. Protection against first claim coverage is now offered by most companies for a nominal fee.
If you have been with your insurer for 20 plus years, and they offer this coverage, surely they must have discussed it with you at your renewal.
Secondly, they wouldn't deny coverage in the future unless other claims had been reported.
Thirdly, I always discussed with my clients the implications of submitting small claims.
In the case of an at fault loss if the damage is minimal it is better to pay it yourself.
An insurer generally will not cancel you unless you have 3 at faults, so I would question that.
I also always advised clients who did not want to report claims that they should get a signed release from the third party so that they can't come back.

 

[SnowWhite]

As a driving instructor I am required to carry 2 Million coverage as it is the law. I totally agree that people should start thinking about the switch as said earlier you are responsible for any payout over and above the standard 1 million that your policy would cover. For the little extra amount it is certainly worth the piece of mind. ESPECIALLY IN THE STATES!!!!! Have an accident there and you could be on the hook for a whopping amount! Even lawsuits here are starting to creep up in payments as well. 1 million used to be adequate coverage, but as all things do judgements are going up.

Rob (Snowwhite's DH)