Glossary: Insurance Limits

Insurance Limits:

Generally speaking, insurance limits establish the maximum amount that an individual’s auto insurance policy may pay out for personal injury claims following a motor vehicle accident. Thus, in the aftermath of an accident, an insurance company may pay for an insured’s covered losses up to a predetermined insurance limit. To register a vehicle in New York, the vehicle must be insured up to certain minimum insurance limits.  

For example, under New York law, motorists are required to carry a minimum amount of liability coverage in their auto insurance policies. The minimum amount of bodily injury liability coverage that a motorist must carry is $25,000 per person and $50,000 per accident. While those figures represent the minimum limits required under state law, policyholders can, and often do, choose higher limits when seeking insurance coverage.  

Bodily injury liability insurance requires the insurance company to defend and indemnify the insured from claims made by others, including claims for pain and suffering. In exchange for premiums, the insurance company agrees to pay up to a certain amount.  

To receive compensation for pain and suffering after a New York motor vehicle accident, an injured person must generally show a “serious injury.” Under New York law, a “serious injury” is defined to include: death; significant disfigurement; dismemberment; a fracture; loss of a fetus; permanent loss of use of a body organ, member, function, or system; permanent consequential limitation of use of a body organ or member; significant limitation of use of a body function or system; or a non-permanent injury preventing you from performing your daily activities for not less than 90 days within the 180 days immediately following the accident. Only one of these “serious injury” categories must be shown. The injured person must also prove that the at-fault motorist was “negligent” and that the motor vehicle collision was at least partly the at-fault motorist’s fault.   

Bodily injury liability insurance coverage is not the only type of insurance coverage that can affect injured people on New York roads. Other types of insurance coverage include supplementary uninsured/underinsured motorist (“SUM”) and uninsured motorist (“UM”) coverage. Unlike bodily injury liability coverage, these coverages provide for benefits to be paid directly to the insured, as opposed to a third-party who is making a claim against the insured.  

An experienced car accident attorney can examine the available insurance coverages to ensure that an injured person can receive maximum compensation for pain and suffering. Questions on a bodily injury claim after a motor vehicle accident or the available insurance limits? Contact William Mattar at (844) 444-4444.