Liability Limits – What Are They & Why Are They Important?


Liability limits – what are they and why are they an important part of my auto insurance coverage?  Hello I’m Chip Fridrich.


The limits that you ultimately decide to purchase for your auto insurance coverage are vital. By definition, they detail the amount of coverage that you have from the insurance company for any bodily injury or property damage that may occur through your fault in a covered claim. There is also a limit of liability for uninsured motorist coverage. This provides coverage to you the insured if an accident occurs that is not your fault and the other party do not have insurance or they do not have enough.


We live in a very litigious society today. You cannot afford to be cheap when it comes to your liability limits because you hard working assets – everything you have worked hard to attain – are at stake if you fail to protect yourself adequately. In fact, our agency refuses to sell minimum state limits to customers unless you sign a waiver – that’s how strongly we feel about it.


Minimum state limits where I live are $25,000 per person involved in an accident, $50,000 worth of coverage per accident and $25,000 for property damage. Do you know how many cars you drive by each day that are worth more than $25,000??? I would guess thousands. And if you or a family member are involved in accident where you are at fault and you only have a limited amount of property damage coverage, then the balance will come out of your pocket – not the insurance company’s. Recently I saw a television commercial about car insurance where the pitch was “we can get you legal”. If this is going to be their sales pitch and you fall for it then you are not getting the clear picture that I just described. In my opinion you are being misled.


Look, I understand that price can be an issue for a lot of things. Money can be tight and I get that. But if an auto claim that is you or a family member’s fault is big enough, it can lead to financial ruin for a great number of people. More than simply selling insurance products, my job is to inform my customers and potential customers and my advice would be to price higher limits if you currently do have low limits of liability. You might be very surprised at how inexpensive raising your liability coverage can be.


Finally, I am a big advocate of having umbrella or excess liability coverage. In order to have this type of coverage, you must for most companies have a base amount of at least $300,000 to $500,000 of liability on your auto policy to qualify. Umbrellas give customers that added level of protection and to me are a great value for the money.


If you have any additional questions about your automobile coverage or want to discuss the potential of adding umbrella coverage to your portfolio of insurance products, contact us and our team will walk you through the process. In turn, we very well can lower your rates, provide better coverage, and bundle your policy together with your home or renter’s policy for even more savings.


To learn more about our Agency, contact us at You can also find us on the web at





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