Can I recover more than the insurance policy limit after a car accident?

December 18, 2020

Can I recover more than the insurance policy limit after a car accident?

insurance policy limit
How to receive compensation for a car accident if the damages exceed the insurance policy limit? Arizona law allows car accident victims to seek damages sustained in a car accident against the at-fault parties. When you file a claim against the at-fault driver, it’s usually his/her insurance company that settles the claim and pays the compensation according to the limits on the insurance policy.

But what happens when the damages and compensation exceeds the insurance policy limit? Is it still possible to recover the full compensation? Usually this is possible, but sometimes things aren’t so simple and in order to achieve this, you would need an experienced Arizona car accident to navigate the entire process with you.

Ways to recover more than the insurance policy limit

Insurance policy premiums are determined on specific coverage and policies limit each area of coverage. So for example, if your insurance policy has a property damage limit of $4,000, that’s the most your insurance company will be willing to pay to cover a property damage claim.
However, car accident claims usually surpass insurance policy limits. This is mostly the case with car accidents that involve serious injuries. Courts can (and most likely will) rules that the insurance limit is slated to pay, the insurance company will generally stick to the insurance policy limit and this makes collecting compensation quite difficult. But here are some solutions

Umbrella policy

Even though this is rare, but sometimes the defendant carries a so-called “umbrella policy” which provides more coverage than the primary policy. These “special” policies are designed to take effect if the policyholder’s liability exceeds the limits of the primary policy. So if the defendant has an umbrella policy, that will most likely cover the entire amount of your damages.

Law suit against the at-fault driver

In the event that the damages exceed the policy limit, car accident victims could be eligible to recover the difference by suing the at-fault driver. In this scenario, you have to keep in mind that sometimes the at-fault driver may not have enough personal assets that he could use to cover the difference, In that case, recovering the full amount for the damages would be impossible.

Suing multiple defendants

Another ‘strategy’ is that you could sue multiple at-fault defendants. This way your lawsuit will have access to various insurance policies which jointly can cover the claim. You can hold the defendants liable for the damages, separately or jointly and the compensation will be pulled from each insurance policy.

Insurance bad-faith

When an insurance company can settle a reasonable and provable car accident claim, but they fail (or refuse) to do so, we call this “insurance bad-faith”.
When a claimant (victim) is willing to settle with the at-fault driver within the insurance policy’s limits, and the insurer refuses to do so, then the insurer can become liable for the FULL amount of damages awarded against the defendant.
There are several ways which you can receive compensation for your car accident damages, even if they exceed the insurance policy limits. The process might be more complicated, and you will definitely need to have an experienced car accident lawyer, but don’t let that discourage you.
If you or your loved one were in a car accident, contact Schenk Podolsky today for a consultation and get the compensation you’re owed.