Insurance policy limits cap what insurers will pay, but your actual damages often exceed these amounts. When your losses surpass available coverage, you face important decisions about pursuing additional compensation through other sources or accepting inadequate settlements.
Our friends at Presser Law, P.A. discuss situations where case values clearly exceed defendant’s insurance limits and what options exist for recovering full compensation. A car accident lawyer can identify all available coverage sources and evaluate whether pursuing assets beyond insurance makes sense.
We regularly handle cases where damages far exceed the at-fault party’s insurance coverage. Understanding when and why this happens helps you know if you’re facing this situation.
1. Catastrophic or Permanent Injuries
Spinal cord injuries, traumatic brain injuries, severe burns, amputations, and other catastrophic injuries generate damages that easily exceed typical insurance limits. Medical expenses alone can reach millions over a lifetime.
According to the National Spinal Cord Injury Statistical Center, lifetime costs for spinal cord injuries range from $1.1 million to over $5 million depending on injury severity. Most auto insurance policies cap at $100,000 to $500,000 per person.
These cases involve extensive future medical care, home modifications, attendant care, lost lifetime earnings, and permanent pain and suffering. The math simply doesn’t work within standard policy limits.
2. Multiple Defendants Share Liability
When several parties contributed to your injuries, multiple insurance policies might apply. A trucking accident might involve the driver’s policy, the trucking company’s commercial coverage, the truck manufacturer for defective parts, and the cargo loading company.
Each defendant brings their own insurance coverage. Combined limits from multiple policies can substantially increase available compensation even when individual policies seem inadequate.
3. Commercial or Business Insurance Applies
Commercial liability policies typically carry higher limits than personal auto insurance. Businesses often maintain coverage of $1 million to $10 million or more.
When accidents involve employees working, delivery drivers, company vehicles, or business operations, commercial policies provide substantially more coverage than personal policies.
4. Umbrella Policies Provide Additional Coverage
Many people purchase umbrella policies that provide additional liability coverage beyond their primary insurance. These policies typically start at $1 million and can reach $5 million or more.
Defendants don’t always disclose umbrella coverage voluntarily. Thorough investigation uncovers these additional policies that dramatically increase available compensation.
5. Young Victims With Decades of Lost Earnings
A 25-year-old permanently disabled in an accident faces 40 years of lost income. Even modest salaries compound to millions over a career when you include raises, promotions, and benefits.
Economic calculations for young victims regularly exceed policy limits because their losses extend so far into the future.
6. Medical Expenses Require Ongoing Treatment
Some injuries require medical care for life. Diabetes from a pancreatic injury needs insulin forever. Joint replacements need revision surgeries every 10 to 15 years. Chronic pain requires ongoing pain management.
Calculating lifetime medical costs for conditions requiring permanent treatment quickly exceeds standard insurance limits.
7. Homeowner’s Insurance Coverage Applies
Certain accidents trigger homeowner’s insurance rather than auto coverage. Dog bites, slip and falls on property, swimming pool accidents, and other premises liability cases fall under homeowner’s policies.
These policies often include substantial liability limits separate from auto insurance, providing additional compensation sources.
8. Multiple Injuries to One Victim
Polytrauma cases where you sustain injuries to multiple body systems generate higher damages than single injuries. Breaking your leg, suffering internal injuries, and sustaining a concussion in one accident creates compounding medical expenses and pain.
The combined impact of multiple injuries often pushes total damages beyond available policy limits.
9. Wrongful Death Claims
Fatal accidents create damages for multiple beneficiaries. Surviving spouses, children, and sometimes parents all have claims for their individual losses. The deceased’s estate has separate claims for medical expenses and pain before death.
These combined claims regularly exceed defendants’ insurance coverage, especially when victims supported families or had significant future earning potential.
10. Punitive Damages Apply
Some cases involve conduct so reckless or intentional that punitive damages apply. Drunk driving accidents, deliberate assaults, or gross negligence can trigger punitive awards designed to punish wrongdoing.
Punitive damages are separate from compensatory damages. They’re meant to punish and deter rather than compensate. Insurance often doesn’t cover punitive damages, meaning defendants must pay from personal assets.
11. Your Own UIM Coverage Exceeds Their Limits
Your underinsured motorist (UIM) coverage can exceed the at-fault party’s liability limits. If you carry $500,000 in UIM coverage and the defendant only has $50,000 in liability insurance, your own policy provides substantial additional compensation.
In this scenario, your case value effectively equals your UIM limits rather than the defendant’s inadequate coverage.
What Happens When Damages Exceed Limits
Several options exist when your damages surpass available insurance:
- Accept policy limits and waive additional recovery
- Pursue the defendant’s personal assets through litigation
- Utilize your own UIM coverage for the gap
- Negotiate structured settlements maximizing policy payouts
- Identify additional insurance policies or liable parties
Each option carries different risks, costs, and potential outcomes.
Pursuing Personal Assets Beyond Insurance
When defendants have collectible assets like real estate, business interests, retirement accounts, or significant income, pursuing them personally might make sense. This requires litigation and proving you can actually collect any judgment you win.
Many defendants judgment-proof, meaning they have no assets worth pursuing. Spending time and money chasing uncollectible judgments wastes resources better spent maximizing insurance recovery.
The Role of Asset Investigations
We conduct asset searches to determine whether defendants have collectible assets beyond insurance. These investigations reveal property ownership, business interests, professional licenses, and financial accounts.
Knowing what assets exist helps you make informed decisions about whether pursuing recovery beyond policy limits is worthwhile.
Settlement Considerations
Sometimes accepting available policy limits represents the best outcome even when your damages exceed them. Litigation costs money and takes time. Uncollectible judgments are worthless.
We analyze whether the potential for additional recovery justifies the cost and risk of pursuing assets beyond insurance.
Multiple Policy Coordination
When several insurance policies apply to your case, coordinating recovery from all sources maximizes your compensation. This might include the at-fault party’s coverage, additional defendants’ policies, your own UIM coverage, and any umbrella policies.
Proper coordination requires understanding how policies interact and which should be accessed first.
Understanding Your True Case Value
Knowing your case exceeds policy limits doesn’t automatically mean you’ll recover your full damages. It means you need strategic thinking about maximizing available compensation sources.
If you’re facing serious injuries that clearly exceed the at-fault party’s insurance coverage, we can evaluate all potential sources of compensation, investigate whether pursuing assets beyond insurance makes sense, and develop a comprehensive strategy for maximizing your recovery under your specific circumstances.
