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?

thanks

It's a good sales pitch, but it sounds like she didn't finish it :-).

What you should have to cover the eventuality she mentioned is an
umbrella policy. Most umbrella policies require a certain level of
coverage on the underlying automotive and homeowners policies, and then
cover any costs up to a specific higher total amount (commonly, $1
million) after the underlying policies "run out." The amounts she
convinced you to get on your auto policy are probably the amounts
required by the umbrella policies she sells. It's a mystery why she
didn't pitch you the umbrella policy as well.

Go to www.ask.com and search for "What's an umbrella policy?" for
additional information.

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/

What matters is what assets you are protecting and how much they are
worth. If you crash into a new Porsche and injure the driver in an
accident that is your fault then you will wish you had a lot of insurance
coverage. This actually happened to someone I know. As someone else said,
if you don't have any assets then don't worry about it because there's
nothing to lose.


Dimitri

100/300 sounds like a starting point for anyone with reasonable assets.
I just renewed mine which has been at 250/500 for a long time. With
today's medical costs, even one person seriously injured in an accident
can quickly run up $100K. And the umbrella policy is another good
suggestion.

wrote...
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?

It may be a sales pitch, but a reasonable one. I consider 100/300 as a MINIMUM
these days!

Also, there are "umbrella" liability policies available that cover what
individual policies may leave out, and with higher limits. They generally
require certain minimum limits on underlying car/house/boat policies.

"D. Gerasimatos" wrote...

What matters is what assets you are protecting and how much they are
worth. If you crash into a new Porsche and injure the driver in an
accident that is your fault then you will wish you had a lot of insurance
coverage.

....except that the first 2 liability numbers don't address property damage, so
the Porsche is not included. You need 100/300/50 or 200/500/100 (or similar) to
pay for the Porsche!

In article ,
says...


What matters is what assets you are protecting and how much they are
worth.
.....
As someone else said,
if you don't have any assets then don't worry about it because there's
nothing to lose.

You'd want to consider reasonable future income expectations, too.
If you're just about done with your residency as a neurosurgeon, you
might have plenty of debt and not many assets right this minute, but
you still have enough future income to be a tempting target.

--
is Joshua Putnam
http://www.phred.org/~josh/
Updated Bicycle Touring Books List:
http://www.phred.org/~josh/bike/tourbooks.html

Joshua Putnam writes:

if you don't have any assets then don't worry about it because there's
nothing to lose.

You'd want to consider reasonable future income expectations, too.
If you're just about done with your residency as a neurosurgeon, you
might have plenty of debt and not many assets right this minute, but
you still have enough future income to be a tempting target.

What about non-neurosurgeons?

Assume I am at fault in an accident, and the other guy has $500K
in medical expenses, and I have a $30K (minimum required) liability
insurance.

Couldn't he get the court to garnish my wages, effectively cutting
my salary in half [1] for the rest of my life?

[1] I know there is a limit of 25% of disposable income, but taking
25% of disposable income from someone in 35% income bracket and 10%
state income tax does effectively halve ones' salary.
--
In order to understand recursion you must first understand recursion.
Remove /-nsp/ for email.

"It may be a sales pitch, but a reasonable one. I consider 100/300 as
a MINIMUM
these days! "

It's not likely a sales pitch. The difference in premium between say
50/150 and 100/300 is pretty small. And going to 250/500 costs even
less additional. The biggest cost with liability insurance is the
initial piece, because that is the most likely to be paid out. Plus, I
think if an agent wanted to push something, there are much better
products that they earn hefty commissions on, like life insurance.

I remember going to get car insurance as a young college grad many
years ago. The agent, who was a total jerk, kept pushing life
insurance, despite the fact that I had no dependents. He even told me
he had to do that, otherwise I could sue him if he didn't offer it. I
guess he failed to see how that might be difficult from the grave. LOL

In article ,
Paul Pluzhnikov wrote:

What about non-neurosurgeons?

Assume I am at fault in an accident, and the other guy has $500K
in medical expenses, and I have a $30K (minimum required) liability
insurance.

Couldn't he get the court to garnish my wages, effectively cutting
my salary in half [1] for the rest of my life?

[1] I know there is a limit of 25% of disposable income, but taking
25% of disposable income from someone in 35% income bracket and 10%
state income tax does effectively halve ones' salary.



I am not 100% sure of this, but I believe you can have court judgements
discharged in a bankruptcy.


Dimitri

(D. Gerasimatos) writes:
I am not 100% sure of this, but I believe you can have court judgements
discharged in a bankruptcy.

Perhaps, but only if you're actually bankrupt. Being on the
hook long-term to pay off a legal settlement is not equivalent
to being bankrupt, and Congress just made it quite a bit
harder to declare bankruptcy.

On Sun, 18 Dec 2005 06:13:09 +0000 (UTC), someone wrote:

... As someone else said,
if you don't have any assets then don't worry about it because there's
nothing to lose.

I think there's even more to it than that. If you injure someone, is
it really OK to stiff them because ha ha I have no assets you can;t
collect from me? Do we tell people that if they have no assets then
they don't have to pay their other bills either?

"Sufficient" is relative, but one should have sufficient coverage to
meet reasonably foreseeable responsibilities.


Reply to NG only - this e.mail address goes to a kill file.

(v) writes:

On Sun, 18 Dec 2005 06:13:09 +0000 (UTC), someone wrote:

... As someone else said,
if you don't have any assets then don't worry about it because there's
nothing to lose.

I think there's even more to it than that. If you injure someone, is
it really OK to stiff them because ha ha I have no assets you can;t
collect from me? Do we tell people that if they have no assets then
they don't have to pay their other bills either?

If they file bankruptcy and they're in the US, yes that's exactly what
they're told.

"Sufficient" is relative, but one should have sufficient coverage to
meet reasonably foreseeable responsibilities.

Agreed.

--
Todd H.
http://www.toddh.net/