The typical buyer of a car insurance policy does not pay much attention to the size of the promised 3rd party liability coverage. Most of the car owners that buy automobile insurance in Alberta feel satisfied with a policy that provides up to $1,000,000 in 3rd party liability coverage. Unfortunately, that widely-accepted figure does not cover the policy holder to a sufficient level.
What is the purpose behind paying for 3rd party liability coverage?
If you are a good driver, you hope that you will never be named at-fault for a given accident. Still, it is possible that you might be held responsible for injuries to young passengers, as the result of a collision. Alternatively, you might become involved in a multi-vehicle incident.
Personal injury lawyer in Lloydminster knows that if you were to be held even partially responsible for either of those incidents, the other party might decide to sue you. If that were to be the case, then you would need money, which could be used to pay-off the plaintiff. A good insurance policy covers the policy holder, if he or she becomes liable for accident-related damages.
What happens if the level of your coverage fails to meet the demands placed on you by the plaintiff?
If the court has ordered the granting of a large award, one that is larger than the amount promised by your policy’s liability coverage, then you become responsible for paying-off the judgement. It could take many years for you to pay that off.
If the plaintiff does not agree to promised delivery of payments in the future, your assets could be at risk. The desire of some 3rd parties to go after a defendant’s assets underscores the value in a policy that serves as protection against such plaintiffs.
What level of protection should be promised by an automobile insurance policy?
Ideally, it offers up to $2,000,000, if the policy holder becomes liable for the damages caused by a given accident. Otherwise the financial security of the liable policy holder stands at risk. That same policy holder could lose valuable assets.
When a policy promises $2,000,000, then none of the policy holder’s money or assets get used to cover the damages caused by a given accident. After all, the damage award might include the costs associated with lost future earnings, if the victim has suffered a catastrophic injury. Do you want to be held responsible for such costs?
If you have answered “no,” then you have highlighted the message that this article is seeking to get across to all car owners. Pay attention to the details in every section of your car insurance policy. Pay particular attention to what has been written about the level of protection against a third party’s demands.