Personal Injury Law Blog

How Often Do Auto Accident Settlements Exceed Policy Limits in California?

In every state, insurance policies have limits that determine how much another driver may be entitled to if the policyholder causes an accident. However, policy limits aren’t always enough to cover the various medical expenses you incur after an auto accident injury

After an accident, you may wonder, How often do auto accident settlements exceed policy limits in California? If your damages exceed the other driver’s policy limits, there are other ways to pursue compensation. The attorneys of Glotzer & Leib, LLP., can help guide you through your claim from start to finish.

California Insurance Coverage Laws

Under Vehicle Code § 16451, California sets a minimum liability coverage amount for all drivers. This includes both bodily injury and property damage coverage.

Minimum Bodily Injury Liability Limits

  • $15,000 for the injury or death of one person in a single accident.
  • $30,000 for the injury or death of more than one person in a single accident.

Minimum Property Damage Liability Limits

  • $5,000 for damage to other people’s property.

Keep in mind that this is only the minimum coverage required by law. Some motorists have coverage with higher policy limits.

What Happens When a Car Accident Claim Exceeds Insurance Limits?

By law, insurance companies in California must examine all of the details of your claim and offer a fair settlement. However, most insurance companies consider a fair settlement to be anything under or at a policy limit. For example, if the at-fault driver has $15,000 in bodily injury liability coverage, the injured party is entitled to that $15,000 limit. 

So, how often do auto accident settlements exceed the policy limits in California? Usually, it depends on the circumstances of the accident and whether the claimant files a lawsuit.

When a car accident claim exceeds policy coverage, the insurance company tries to find any reason to limit or deny the claim. In cases like this, it’s common for the claimant to file a lawsuit against the insurer or another party involved in the accident to get higher compensation.

Ways of Suing Beyond Policy Limits

If your accident claim exceeds policy limits, there are a few ways to pursue further compensation. At Glotzer & Leib, LLP., our car accident attorneys are experienced at fighting for higher settlements for victims.

File a Lawsuit Against the At-Fault Driver Personally

While the driver responsible for your injuries may have insurance coverage, there is a chance that their policy won’t cover everything. If the driver has sufficient financial resources, it may be best in some cases to sue them for the excess amount owed to you.

However, not everyone has the money to pay personal injury judgments. Filing a lawsuit against a driver with low income or few assets isn’t guaranteed to result in more money in your pocket. If that is the case, we move on to the next options.

File a Lawsuit Against the Insurance Company for Acting in Bad Faith

In California, insurance companies must act in good faith towards anyone filing a claim, even if they aren’t a policyholder. Under Insurance Code § 790.03, California defines acting in bad faith as:

Insurance companies use a variety of tactics to try to minimize or delay a claim, and sometimes those tactics are illegal. With proof, it’s possible to hold the insurance company accountable for acting in bad faith if your claim exceeds policy limits.

If Applicable, Sue Another Party Involved in the Accident

Accidents sometimes involve multiple parties. Whether you get hit by more than one driver or by a driver working for a delivery company, it’s often possible to recover compensation from more than one person’s insurance policy.

One example of this is if an on-duty package carrier causes your accident. In this case, you may be able to seek compensation from the carrier’s employer.

Uninsured/Underinsured Motorist Coverage

Unfortunately, there are many drivers on the road who don’t carry the legally required minimum insurance policy limits. For cases like this, it’s essential to have uninsured and underinsured motorist coverage. This means that if the at-fault driver doesn’t have any insurance, you may make a claim under your own policy.

In addition, if you exhaust all forms of compensation from the other driver’s coverage, you may be able to seek additional compensation from your uninsured/underinsured motorist coverage.

However, this only applies in certain circumstances, so consult with one of our attorneys before attempting to make a claim through your own policy.

How Long Do I Have to File a Lawsuit?

The state of California limits how much time you have to file a lawsuit for personal injury. Under CCP § 335.1, claimants have two years from the date of injury to sue the responsible party.

For example, if your crash occurred on November 10, 2021, you have until November 10, 2023 to file a lawsuit. However, if a government employee caused your personal injury, you must file a claim with the appropriate state or municipal entity within six months. 

If you don’t file your lawsuit within the applicable period, chances are good that the court will deny any action related to the accident. For this reason, it’s important to retain a knowledgeable car accident attorney when there is still plenty of time left to file your lawsuit.

Injured in a Car Accident? Call Glotzer & Leib Today

Whether you or a family member sustains an injury in a car accident, don’t trust the insurance company to give you a fair settlement.

At Glotzer & Leib, LLP., we dedicate ourselves to representing the best interests of victims and their families. Our attorneys fight for the compensation you need so you can focus on recovery.

To schedule a free consultation, call us at 213-309-3050 or contact us online. We proudly serve clients throughout Southern California from our office in Los Angeles.

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