How Do Insurance Policy Limits Work?

When the At-Fault Driver’s Insurance Isn’t Enough: What You Need to Know

If you’ve been injured in a car accident caused by someone else, your first step for financial recovery is typically through the at-fault party’s auto insurance policy. When the driver is operating a commercial vehicle, this can work in your favor—commercial policies often carry significantly higher liability limits than standard personal auto policies. That means more potential compensation if your injuries and losses are severe.

But what happens if the at-fault driver is a wealthy individual with only minimum insurance coverage—and that coverage doesn’t come close to covering your medical bills?

When Insurance Falls Short

It’s a frustrating and unfair reality, but it happens. In these situations, your attorney may be able to file a lawsuit to go after the driver’s personal assets—like extra vehicles, boats, savings accounts, or vacation properties. Courts recognize that if someone has the financial ability to own luxury or non-essential assets, they should be held responsible for the harm they cause.

That said, suing for personal assets can be a complex and drawn-out process. It’s not something we recommend attempting without a seasoned car accident lawyer by your side.

How Insurance Policy Limits Work

Insurance companies are in business to make money—meaning they aim to pay out as little as possible on claims. Often, adjusters are your biggest hurdle. But even if the insurance company agrees to pay the maximum amount allowed under the policy, it might not be enough to cover all your damages.

Every insurance policy has a limit—a cap on what the insurer is contractually obligated to pay. If your losses exceed that amount, the insurance company won’t cover the difference.

Fortunately, you may have options.

When Damages Exceed Policy Limits: What Are Your Options?

Settlements that exceed the policy limit are rare—insurance companies almost never agree to pay more than they’re obligated to. However, if your injuries are extensive and your losses surpass policy limits, you can still pursue compensation through:

• Filing a lawsuit for the excess amount. If successful, a jury may award you more than the policy covers.
• Investigating for additional coverage. The driver may have an umbrella policy or separate coverage on another vehicle.
• Identifying other liable parties. In commercial cases, employers are often responsible for their employees’ negligence.

Understanding Umbrella Policies

An umbrella policy provides coverage beyond the limits of a standard auto insurance policy. These are especially common among businesses but can also be held by private individuals.

If the at-fault party has an umbrella policy, it could make a significant difference in the total settlement amount. But don’t expect the insurance company to tell you about it—this is where having an experienced attorney pays off.

How to Find Out the At-Fault Driver’s Policy Limits

Knowing the other party’s insurance limits helps guide your settlement strategy. Here are ways you may be able to find out:

• Ask directly. The driver or their insurance adjuster may voluntarily disclose the limits.
• Send a demand letter. Under certain legal conditions, you can compel disclosure before filing a lawsuit.
• Litigation discovery. If you file a lawsuit, policy information will be revealed during the process.

What Happens If a Jury Awards You More Than the Policy Limit?

If you go to trial and win more than the insurance policy covers, the excess amount is known as an excess verdict. For example, if the driver’s policy covers $100,000 but the jury awards you $200,000, the extra $100,000 becomes a personal obligation of the at-fault driver.

You can then attempt to collect this excess amount by going after the driver’s non-exempt assets.

What Assets Can Be Taken?

Certain assets are legally protected—like the driver’s primary home and primary vehicle. However, assets such as vacation homes, motor vehicles, boats & investment properties can potentially be seized or sold to satisfy a judgment. Keep in mind:

• Liens must be filed in each county where the defendant owns property.
• The judgment doesn’t take immediate effect—you may need to wait for the asset to be sold.
• Other lienholders get paid first, such as mortgage companies.
• The sheriff takes a percentage of seized asset sales.

When the At-Fault Driver Has Few or No Assets

Some drivers carry only the minimum required insurance and have no significant assets to seize. In such cases:

• Suing might not be worth it, since there’s nothing to collect.
• Look for other liable parties. For example, if the driver was working at the time of the crash, their employer may be liable.
• Check your own coverage. Supplementary Uninsured Motorist (“SUM”) coverage with your own vehicle insurance policy may help fill the gap.

Don’t Be a Victim Twice – Call 1-800-VICTIM2 (1-800-842-8462)

Car accident cases can quickly become complex—especially when serious injuries are involved and insurance coverage is limited. The New York City Car Accident Lawyers at Greenstein & Pittari, LLP can investigate all avenues of compensation and guide you through the legal and insurance maze.

Our firm’s motto is “Don’t Be a Victim Twice”.  If you or a loved one was the victim of a motor vehicle accident, call 1-800-VICTIM2 (1-800-842-8462) to schedule a confidential consultation. The call is free. The consultation is free. You don’t pay us unless we are successful.  That’s our “Our Fee Guarantee – No Fee Unless Successful

Call us today at 800-VICTIM2 (1-800-842-8462) for a free case evaluation. Let us fight for the compensation you deserve.

We have seven convenient locations throughout New York. We maintain offices in Harlem, Bronx, Brooklyn, Queens, Staten Island, Yonkers, and Nassau County. Your convenience is our top priority!