Liability coverage is insurance coverage that you have on your automobile policy to protect you if you or a family member is responsible for causing an accident. Liability insurance protects your family’s assets from a judgment or verdict against you. Your insurance company, however, is only contractually obligated to pay a settlement or verdict up to the limits of the liability coverage. The insurance company is also required to hire a lawyer at its own expense to defend you if you are sued for an accident that is your fault.

Pennsylvania motorists are only required to carry $15,000 per person/$30,000 per accident in liability coverage. Although it is legal to carry such low liability limits, it is unwise to do so. By carrying such low liability limits, you are exposing yourself personally to liability over and above the minimum insurance, in the event you cause serious injury or death to another person in a motor vehicle accident. We, at Hagelgans & Veronis, recommend that you carry at least $100,000 per person/$300,000 per accident in liability coverage. If your family has substantial assets, you should purchase higher limits of liability insurance sufficient to protect those assets from a judgment or verdict against you or a family member.

If you have substantial assets, you should purchase an umbrella or excess liability policy, which will provide additional coverage to pay a settlement or verdict entered against you if you cause a serious accident. If you have substantial assets and want to protect those assets from a potential judgment or verdict, we recommend that you purchase one to three million dollars in excess liability insurance. Most insurance companies will require you to purchase at least a $250,000 underlying liability policy before you will be eligible to purchase an excess or umbrella liability policy.

When liability coverage is presented as "$100,000 per person/$300,000 per accident," it means that any one person injured in a motor vehicle accident caused by the person with the $100,000/$300,000 policy can recover a maximum of $100,000. If more than one person is injured, the insurance company will pay up to $300,000 for the accident, no matter how many people are injured, and a maximum of $100,000 per person injured.