What if My Florida Car Accident Exceeds Insurance Policy Limits?

When involved in a car accident, it’s easy to assume that the involved insurance companies will handle the financial aspects. According to Florida law, all drivers are required to carry $10,000 of Personal Injury Protection (PIP) insurance coverage, which handles personal medical expenses and bodily injury damages. But many times, medical bills and other damages can far exceed $10,000. Injured parties can seek further compensation from those at fault and their insurance policies, though it is important to be aware that insurance companies work within policy limits when determining what they are willing to pay out. It is important to be aware of the insurance policy limits involved in your case so that you can prepare your next steps following an Orlando auto accident.

What Are Policy Limits?

Every liability insurance policy, regardless of type, has policy limits. Insurance companies use policy limits to determine where their financial responsibility ends in the event of an accident. Policy limits are the greatest dollar amount an insurance company can be held responsible for if an accident or injury occurs. For example, if the at-fault party has a bodily injury policy limit of $50,000, the insurance company is not financially responsible for damages beyond this amount. Despite this, in many cases there are ways for an injured party to collect compensation beyond the policy limit.

Collecting Additional Compensation Outside of Policy Limits

There are four approaches to collecting compensation beyond insurance policy limits that are most common:

  • Excess or umbrella insurance policies;
  • Suing multiple defendants in a personal injury lawsuit;
  • Collecting directly from a defendant’s personal assets.
  • Uninsured/Underinsured Motorist Coverage

Umbrella Insurance Policies

An umbrella insurance policy is typically held by large businesses and corporations, although individuals can also have them. This type of policy is put in place to protect the policyholder from liability for costs that exceed the original policy limit.

For example, in the event a Florida driver was liable for damages that exceeded a $50,000 policy limit but this driver had an umbrella policy of $20,000, the second policy could be utilized to cover up to $20,000 of remaining costs.

Bringing a Personal Injury Lawsuit Against Multiple Defendants

In some cases, multiple parties can be found liable for damages. While this is less common than single defendant cases, it can be very useful in the event that this occurs. There are many scenarios where multiple defendants can be held financially responsible for damages. For instance, if the defendant was driving a commercial vehicle such as a company car or they were in the course and scope of their employment at the time of the accident, the employer can also be responsible for the negligence of their employee. Also, if the defendant is driving a car owned or co-owned by another party, the owner can be responsible.

Collecting Directly from the Defendant

Very commonly, when damages go beyond the insurance policy limits of the at-fault party, the only option available to you is to collect from the defendant’s personal funds or assets. If the defendant does not possess the assets or funds to compensate you what is owed, there are few opportunities to collect.

A way to potentially receive your compensation from an at-fault party is to obtain a wage garnishment or lien on the defendant’s assets, assuming they have enough to do so. If they do not have assets, such as property, or wages to do so, the funds in excess of the policy limit will likely not be collectible.

Invoking Uninsured/Underinsured Motorist Coverage

One of the biggest pieces of advice I can give you as an attorney who represents car accident victims, is to purchase uninsured motorist coverage on your existing auto insurance policy. In Florida, this is not required but it is extremely important considering the fact that nearly one in four Florida drivers are driving without car insurance. A study by the Insurance Research Council (IRC) reported that approximately 23 percent of Florida drivers are uninsured, the fifth highest percentage of uninsured drivers in the nation.

Underinsured and uninsured motorist (UM) coverage protects you when the other driver either does not have car insurance or too little to cover the cost of damages in the accident. This coverage pays for you, your passenger or family member if injured by an ‘at-fault’ driver who does not have bodily liability insurance, not enough liability insurance to cover the total damages sustained in the accident or is driving without car insurance. This coverage applies whether you are riding in your car, someone else’s car or are struck by a car as a pedestrian or bicyclist.

If you carry uninsured motorist (UM) coverage on your policy, once the negligent driver’s insurance coverage limits have been maxed out or they have none, uninsured motorist coverage will step in and pay for your medical expenses, long-term nursing care, if the injuries are particularly severe. This will serve as the primary protection for your injuries and damages sustained in the accident.

The Benenati Law Firm has recovered millions of dollars for its injury clients and accident victims. In Orlando and throughout Central Florida victims injured in accidents or through negligence need only hit the 7s to reach the personal injury offices of the Benenati Law Firm. Our oath to you is handling your case from start to finish effectively, competently, and aggressively. Allow us the opportunity to give you the personal attention you deserve in your case. You pay us nothing unless we win your case. Please do not hesitate to call our office today at 407-777-7777 for a free legal consultation. Abogado Hispano con experiencia en juicios sirviendo las necesidades legales de la comunidad de la Florida.