What are insurance policy limits, and why can’t I recover more than that?
Insurance policy limits severely limit the ability for everyday Texans to recover fair compensation when they are injured or killed due to the negligence of another. While every case is different, let’s talk about insurance coverage, and how policy limits can impact your case.
What is insurance?
Put simply, insurance is purchased from an insurance company (the insurer) to provide financial protection or reimbursement against losses resulting from accidents, injury, or property damage sustained by the person who bought the insurance (the insured). If you have a home, own a car, or work for an employer then you probably have experience with home insurance, car insurance, and health insurance. You probably also have experience with various forms of insurance coverage and how that can affect your premium (your monthly/yearly/quarterly payments for your insurance). If you add flood coverage, hurricane coverage, and termite coverage to your home insurance you are surely more protected from these incidents, but your premium usually rises as a result of the additional coverage. In that same vein, if you have 30k in coverage for bodily injuries sustained in a motor vehicle collision you will likely have a much lower premium than if you had 500k in coverage. Insurance is a trade off vs what you need, what you think you will need, and what you can do without.
How insurance plays out in personal injury cases
In Texas, people, businesses, companies, contractors, and just about every sector of the economy is insured in some form or fashion. If you’re injured from a slip and fall in a local flower shop, that flower shops insurance steps in to litigate your claim for damages. If you’re rear ended by another driver, that driver’s insurance steps in to litigate your claim for damages. If you’re working a construction jobsite and fall through a roof, your employer’s insurance steps in to litigate your claim. The key aspect about insurance coverage in Texas is that people who make claims against another person/entities insurance for damages are generally capped at the insured’s policy limits for the amount they can recover.
There’s no point in getting a $10,000,000.00 (10 million) verdict if you can only recover 30k of the insured’s policy limits for your injuries. In Texas, insurance companies by law, are not required to pay more than an insured’s policy limits for your injuries, effectively capping any compensation you may hope to receive, no matter how gruesome or terrible your loss. There are some exceptions to this rule, but generally there very specific parameters and rules that make it extremely difficult to go after an individuals personal assets to satisfy damages that the insurance policy did not cover.
Why policy limits matter
In Texas, the Texas Insurance Code Chapter 1952 contains the rules for policy limits and how much money is recoverable for injuries caused by an insured. Texas Insurance Code Chapter 1952 states that
(a) The limits of liability for bodily injury, sickness, disease, or death must be offered to an insured in the amounts desired by the insured, but not in amounts greater than the limits of liability specified in the bodily injury liability provisions of the insured's policy.
There are some nuanced exceptions to this rule, but in effect, policy limits will limit ALL Texas lawyers from the amounts they are allowed to recover for you if you were injured due to the negligence of another. How about some real-world examples we have personally dealt with?
1. John is a veteran, has a wife, and is a father of four. John is rear ended and killed by a drunk driver, Paul. Paul is a millionaire. John does not have any PIP, Underinsured/Uninsured motorist coverage and Paul only has the State if Texas’ minimum Texas single person automobile insurance of 30k for bodily injury per person. John and his family are only allowed to recover a maximum of 30k from Paul’s insurance.
2. Stan is a construction worker. Stan steps on a nail left on the ground by a negligent co-worker, Joe. Stan loses his foot due to medical complications after stepping on that nail left by Joe. Stan incurs 500k in medical expenses from his injuries. Stan’s employer covers Joe under the employer’s insurance policy. The company has 100k in General Liability Insurance for bodily injuries. Stan is only allowed to recover a maximum of 100k from Joe’s insurance through the company.
Fair or not, insurance policy limits protect the amount of money an insurance company will have to pay for the actions of an insured and limit the amount of money an injured person can recover for those actions.
What can I do to get more than policy limits?
Except for some extremely limited circumstances that are very nuanced and quite frankly uncommon, the vast majority of Texans will not be able recover more than a negligent person/entities policy limits for injuries that person/entity caused you. If you have suffered bodily injury due to the negligence of another person or company, it is critical to consult with an attorney to maximize the amount of compensation you can receive for your injuries.
Seek legal counsel
If you were injured due to the negligence of another, you should immediately seek counsel to advise you on your rights, and if financial compensation may be available to you through a lawsuit.
Texas Personal Injury and Civil Trial Lawyer
A Texas personal injury and civil trial attorney understands the serious and complex ramifications of being injured due to the negligence of another. Retaining a good personal injury civil trial attorney is your best and first opportunity to build a robust case, offers your best chance of obtaining the financial compensation to make you whole, and is the best way to hold the negligent people and corporations accountable for the damages they have caused you. If you've experienced a personal injury or believe you have a civil case in Dallas, Texas or its surrounding counties, the Law Office of Alton James III is prepared to fight for you. We have dedicated our practice holding negligent people and greedy corporations accountable for their actions when they harm Texans. To set up a free consultation, and to see how we can fight for you, contact the Law Office of Alton James III today at 469.638.5571.
