Dealing with car crashes and filing insurance claims can be daunting. Understanding what happens when the claim amount is much higher than the policy limit is especially perplexing. This article provides an in-depth look into the subject matter while addressing some frequently asked questions. 

When a Car Accident Claim Exceeds Policy Limits in California

In the event of a car accident, if the responsible party does not have adequate coverage, they may not be able to pay for all of the damages caused. This is especially true when they only carry minimum liability insurance or insufficient coverage to compensate for all losses. In such cases, they may have to pay out-of-pocket for expenses that exceed the policy limits.

Californians who suffer from an auto collision can look to the negligent party’s personal assets for additional compensation if their policy limits are not enough. This could involve filing a lawsuit against that person for more damages or just settling for the maximum coverage stated in the policy.

What Happens if Someone Sues You for More than Your Insurance Covers?

Facing a lawsuit and not having enough insurance coverage to cover the full amount of damages can be a nerve-wracking situation. If your insurance doesn’t cover the full amount, you will be held accountable for paying the remaining balance; you might have to take out-of-pocket funds to make up the difference.

Being proactive is absolutely essential if you want to minimize any financial damage that may occur in the event of a lawsuit. To prepare, here are some handy tips you can use:

Review Your Insurance Policy

A thorough review of your insurance policy is essential to understand the scope of coverage. It is important to pay attention to what is included and excluded in the coverage as the amount payable by your insurer will be determined by these limits. Thus, it is worthwhile investing time and effort into understanding your policy.

Don’t Try to Disregard the Suit 

Neglecting to respond or take any action regarding a lawsuit is completely inexcusable and can lead to very serious consequences. Therefore, it is absolutely essential that you take swift and decisive action immediately upon receiving the lawsuit. Taking prompt action within the given timeframe can help prevent the plaintiff from obtaining a default judgment against you, so it is highly recommended that you do not ignore the situation.

Hire an Attorney

Hiring a competent and experienced car accident lawyer is crucial in this situation. Your attorney will help you understand the legal process, negotiate a settlement on your behalf, and represent you in court. They will also help you understand your rights and obligations and can provide valuable advice on how to protect your assets.

Get in Touch 

If you or someone close to you has been in a car accident and the claim is greater than your insurance coverage, don’t hesitate to get in touch with us. The LionsGate Law Group team is committed to representing and fighting for the rights of auto accident victims. We are experienced in navigating these types of cases and understand the intricacies involved with these types of claims.


LionsGate Law Group will assist you throughout all stages of the legal process. Get a free consultation by contacting us today.