Understanding Policy Limits in Insurance

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What are policy limits?

The minimum amount an insurance policy will pay for covered losses

The average amount an insurance policy will pay for covered losses

The maximum amount an insurance policy will pay for covered losses (correct)

The variable amount an insurance policy will pay for covered losses

In car insurance, what does Bodily Injury Liability Limits specifically cover?

Injuries sustained by other people in an accident where you are at fault (correct)

Medical expenses for the policyholder

Damage to someone else's property

Damages to your own vehicle

What does Property Damage Liability Limits cover in car insurance?

Medical expenses for the policyholder

Damage to someone else's property (correct)

Injuries sustained by other people in an accident where you are at fault

Damages to your own vehicle

If you have a $50,000 property damage limit, what does it mean?

The insurance will cover up to $50,000 for property damage you are responsible for in an accident Signup and view all the answers

What does Uninsured/Underinsured Motorist Coverage Limits protect against?

Accidents with a driver who has insufficient or no insurance Signup and view all the answers

What do the Uninsured/Underinsured Motorist Coverage Limits apply to?

Both bodily injury and property damage Signup and view all the answers

Who sets the policy limits when purchasing insurance?

The policyholder Signup and view all the answers

What is Property Damage Liability Limits?

The maximum amount the insurance company will pay for damage caused to someone else's property Signup and view all the answers

What are Bodily Injury Liability Limits in car insurance?

The maximum amount the insurance company will pay for injuries sustained by other people in an accident where you are at fault, typically split into per person and per accident limits. Signup and view all the answers

What is the Per Person Limit in Bodily Injury Liability Limits?

This is the maximum amount the insurance company will pay for injuries sustained by one individual in the accident. Signup and view all the answers

What does the Per Accident Limit in Bodily Injury Liability Limits cover?

This is the overall maximum amount the insurance company will pay for all injuries in a single accident, regardless of the number of people injured. Signup and view all the answers

What does Property Damage Liability Limits in car insurance cover?

The maximum amount the insurance company will pay for damage caused to someone else's property, such as their vehicle or a building. Signup and view all the answers

If you have a $50,000 property damage limit, what does it mean?

The insurance will cover up to that amount for property damage you are responsible for in an accident. Signup and view all the answers

What do Uninsured/Underinsured Motorist Coverage Limits protect against?

This coverage protects you if you are involved in an accident with a driver who has insufficient or no insurance, applying to both bodily injury and property damage. Signup and view all the answers

What are Policy Limits in insurance?

The maximum amount that an insurance policy will pay for covered losses. Signup and view all the answers

What types of aspects do different Policy Limits cover in car insurance?

They cover specific aspects of potential damages or injuries, such as bodily injury, property damage, and uninsured/underinsured motorist coverage. Signup and view all the answers

What is the purpose of Uninsured/Underinsured Motorist Coverage Limits?

To protect you if you are involved in an accident with a driver who has insufficient or no insurance, applying to both bodily injury and property damage. Signup and view all the answers