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writes:
My insurance agent talked me into buying this really high "Limits of
Liability". $100,000 each person / $300,000 each accident. She said I
need to buy this high because I have a house. So just in case a bad
accident happens, I will have enough coverage that not putting the
house into jeapody.

Is that a sales pitch? well, of course a higher coverage is better
for sure. But that comes with cost too! How about other homeowner?
do you folks also have a high coverage because owning a house?

I don't think it's much of a sale pitch. Sounds like reasonable
advice.

I've had $100k/$300k for as long as I remember. Maybe I'm a leming
and have been sucked into what's "standard" but with medical costs
these days, I'm semi concerned that it may not be enough.

Say you're found liable and at fault in a serious traffic accident
that sends someone (perhaps self employed, without medical insurance
of their own) to the hospital. How many days of critical care do you
think it would take to hit that liability limit? Toss in a surgery or
two for a shattered bone, or internal bleeding, or a traumatic brain
injury. A few MRI's. Post-surgical rehab. Replacement of their
totalled automobile. "Pain and suffering." If they can no longer
work as a result of their injuries and won't have a salary as a result...

Now if you're a person without much in savings, you rent your housing,
nothing else in the way of assets, or what not, if a big accident
where you're at fault bankrupts you, perhaps it's a calculated risk
worth taking for lower coverage limits. If they sue you and you're
asset poor, they won't get blood out of a turnip.

But, now make you a home owner. With a home that appreciates such
that in a year or so in a hot market, suddenly you've got a good chunk
of equity. Are you willing to take the calculated risk of losing it
for an accident of a given severity? That's the decision to make for
your personal situation.

Also some insurance companies give breaks for home and highway
policies, and those breaks only come into play if you get your auto
limits up beyond a certain point....

But in short, no, I don't think you're being given a bald faced sales
job. There are lots of reasonable facets to wanting to get your
coverage up to those limits.

Best Regards,
--
Todd H.
http://www.toddh.net/