Recommended Car Insurance Limits?

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Topic Author
Random Poster
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Recommended Car Insurance Limits?

Post by Random Poster »

Curious if there are standard recommendations for what one’s car insurance bodily injury and property damage limits should be.

For bodily injury, I have been at $500k for each person and $1M for each accident, and $300k for property damage. I also have a $1M umbrella policy. Have been with Amica previously but now with USAA due to spouse’s insistence. Live in New Mexico. Investible net worth is $4M+, house is paid off, car is a 2009 Japanese SUV.

In transferring our insurance over to New Mexico from Texas, the USAA rep said that we could drop the car insurance limits to 300/500/100 and still keep the umbrella.

Current 6 month premium for the 500/1M/300 is $513, which seems really high (same coverage in Texas was $432). But if we drop the car limits to 300/500/100, the premium drops to $475.

Being under $500 is mentally more acceptable to me, but the difference is really just $38 for 6 months.

But how do I know if 300/500/100 limits are enough, or if I am over-insuring by going with the 500/1M/300 limits?

Are there are any guidelines or general rules when it comes to deciding what one’s car insurance limits should be?
bloom2708
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Re: Recommended Car Insurance Limits?

Post by bloom2708 »

Each insurance company does it different. Shop around.

Our cars are 100/300 but we have a $2 million umbrella policy. You can't do 250/500 or higher with the umbrella. Umbrella would kick in over the 100/300.

A friend in Denver also has an umbrella, but his company requires 250/500 with his umbrella.

I usually say to find an independent agent in your area.

http://www.cinfin.com has an agent finder right on the front page. See if there are any long standing independent agents in your area you can dig in.
"We are here to provoke thoughtfulness, not agree with you." Unknown Boglehead
HomeStretch
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Re: Recommended Car Insurance Limits?

Post by HomeStretch »

The way I approached it was to have my auto, home and umbrella insurance policies with the same carrier. I have the auto underlying liability limits required by the carrier as any liability claim in excess of the auto limit would then be covered by the umbrella. I don’t hold a higher auto limit than required by the umbrella as my understanding is that any excess auto coverage isn’t additive to the total covered by the auto/umbrella. For example, if the required auto limit was $300k and my umbrella limit is $1 million, increasing my auto limit to $500k doesn’t increase my overall combined coverage by $200k.
Topic Author
Random Poster
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Re: Recommended Car Insurance Limits?

Post by Random Poster »

HomeStretch wrote: Wed Mar 24, 2021 2:21 pm I don’t hold a higher auto limit than required by the umbrella as my understanding is that any excess auto coverage isn’t additive to the total covered by the auto/umbrella. For example, if the required auto limit was $300k and my umbrella limit is $1 million, increasing my auto limit to $500k doesn’t increase my overall combined coverage by $200k.
I guess USAA does it differently, because after calling them three times and talking to three different representatives, they all say that the umbrella is additive to the underlying auto coverage.
Fat Tails
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Re: Recommended Car Insurance Limits?

Post by Fat Tails »

With your financial assets of $4M, you should consider a $4M umbrella liability policy. The insurance company providing the umbrella will set your auto liability/medical limits.

Cheers.
“If you would be wealthy, think of saving as well as getting.” ― Benjamin Franklin
fsax
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Re: Recommended Car Insurance Limits?

Post by fsax »

Sorry to revive an old-ish thread, but after reviewing multiple posts, I haven't really found an answer to my question:

How do you know how much insurance to get?

Enough to cover the value of your car--or enough to cover the value of someone else's car? [e.g. "I drive an old Honda, but what if I get in an accident with a brand-new Mercedes"]

Enough to cover your entire net worth? Suppose I'm at fault, the other person spends a month in the hospital and has a $1.5 million hospital bill--am I covered, or can they take the payout from my insurance and still come after me?

and so on...basically, I don't know how to find a good answer to such questions. But, of course, an insurance agent would be incentivized to say "Hey, a worrier! I'll sell him more insurance than he really needs!!!"

So how can I protect myself?

Additional details: Currently, I have $50k/$100k/$50k, and my net assets total a little over $200k. I'm in my early 30s. I drive a 2007 Accord worth ~$3000. Not a homeowner, so I think that makes me ineligible for an umbrella policy [Guess I'd have to check with my ins. provider--which is State Farm, if that makes a difference].
Topic Author
Random Poster
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Re: Recommended Car Insurance Limits?

Post by Random Poster »

fsax wrote: Sat Jul 10, 2021 1:19 pm Not a homeowner, so I think that makes me ineligible for an umbrella policy [Guess I'd have to check with my ins. provider--which is State Farm, if that makes a difference].
I honestly don’t know the answer to your questions, but I tend to go with “whatever makes you feel comfortable,” which for me generally means enough coverage to cover the other person and to cover any of my assets that could be subject to a judgment or collection matter (which depends, in some part, on your state of residence).

But as to the umbrella issue, you can get an umbrella without being a homeowner. As a renter, I had an umbrella policy. And I think that the umbrella is mostly tied to your car policy, not the renters or home, but I could be wrong about that.
fsax
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Re: Recommended Car Insurance Limits?

Post by fsax »

Thanks RandomPoster, I guess I'll have to check with State Farm about the possibility of getting umbrella coverage. I'll probably have to raise my auto coverage anyway to meet the minimums :happy

I figure there have to be rules of thumb out there somewhere, but my Google skills have not revealed anything helpful to my situation.
iamblessed
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Re: Recommended Car Insurance Limits?

Post by iamblessed »

I would get 250/500/100 with a $3M umbrella.
AlienGrrrl
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Re: Recommended Car Insurance Limits?

Post by AlienGrrrl »

...one other massively important thing (for me) in auto insurance is UM/UIM (Uninsured and underinsured motorist coverage) since way too many drivers don't have coverage, or adequate coverage.
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TexasPE
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Re: Recommended Car Insurance Limits?

Post by TexasPE »

fsax wrote: Sat Jul 10, 2021 1:19 pm Sorry to revive an old-ish thread, but after reviewing multiple posts, I haven't really found an answer to my question:

How do you know how much insurance to get?

Your comfort level. This just happened in our city (and could happen to anyone)

https://www.beaumontenterprise.com/insi ... 300029.php

over $100K in damages
At 20: I cared what everyone thought about me | At 40: I didn't give a damn what anyone thought of me | Now that I'm 60: I realize that no one was really thinking about me at all | Winston Churchill (?)
oldfort
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Re: Recommended Car Insurance Limits?

Post by oldfort »

fsax wrote: Sat Jul 10, 2021 3:36 pm Thanks RandomPoster, I guess I'll have to check with State Farm about the possibility of getting umbrella coverage. I'll probably have to raise my auto coverage anyway to meet the minimums :happy

I figure there have to be rules of thumb out there somewhere, but my Google skills have not revealed anything helpful to my situation.
Lots of back and forth in this thread:
viewtopic.php?f=2&t=349198
OpenMinded1
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Re: Recommended Car Insurance Limits?

Post by OpenMinded1 »

Is money held in tax-advantaged retirement investments, in other words IRAs, 401Ks, 403bs, 457s etc., protected from personal liability lawsuits? If yes, shouldn't this be considered in the decision of whether or not to get an umbrella policy and how much coverage it should provide?
oldfort
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Re: Recommended Car Insurance Limits?

Post by oldfort »

OpenMinded1 wrote: Sat Jul 10, 2021 9:02 pm Is money held in tax-advantaged retirement investments, in other words IRAs, 401Ks, 403bs, 457s etc., protected from personal liability lawsuits? If yes, shouldn't this be considered in the decision of whether or not to get an umbrella policy and how much coverage it should provide?
An ERISA plan is protected in its entirety by federal law. For IRAs, the federal bankruptcy exemption covers the first $1,362,800.
sesq
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Re: Recommended Car Insurance Limits?

Post by sesq »

OpenMinded1 wrote: Sat Jul 10, 2021 9:02 pm Is money held in tax-advantaged retirement investments, in other words IRAs, 401Ks, 403bs, 457s etc., protected from personal liability lawsuits? If yes, shouldn't this be considered in the decision of whether or not to get an umbrella policy and how much coverage it should provide?

All of my assets are either in 401(k)s, IRAs or my house (tenants by entirety). I have a $2M umbrella because I could definitely have my wages garnished.
OpenMinded1
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Re: Recommended Car Insurance Limits?

Post by OpenMinded1 »

sesq wrote: Sat Jul 10, 2021 9:18 pm
OpenMinded1 wrote: Sat Jul 10, 2021 9:02 pm Is money held in tax-advantaged retirement investments, in other words IRAs, 401Ks, 403bs, 457s etc., protected from personal liability lawsuits? If yes, shouldn't this be considered in the decision of whether or not to get an umbrella policy and how much coverage it should provide?

All of my assets are either in 401(k)s, IRAs or my house (tenants by entirety). I have a $2M umbrella because I could definitely have my wages garnished.
Not sure, but I don't think tenants by entirety protects the equity in your house from personal liability lawsuits. Might be something to look into.
anoop
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Re: Recommended Car Insurance Limits?

Post by anoop »

Random Poster wrote: Wed Mar 24, 2021 1:49 pm I also have a $1M umbrella policy.
...
Investible net worth is $4M+, house is paid off, car is a 2009 Japanese SUV.
I thought the general consensus is that size of umbrella policy should be equal to net worth.
iamblessed
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Re: Recommended Car Insurance Limits?

Post by iamblessed »

TexasPE wrote: Sat Jul 10, 2021 7:48 pm
fsax wrote: Sat Jul 10, 2021 1:19 pm Sorry to revive an old-ish thread, but after reviewing multiple posts, I haven't really found an answer to my question:

How do you know how much insurance to get?

Your comfort level. This just happened in our city (and could happen to anyone)

https://www.beaumontenterprise.com/insi ... 300029.php

over $100K in damages
I might pay a 100k to get rid of that pop up ad. LOL I can't get around it.
Last edited by iamblessed on Sun Jul 11, 2021 10:33 am, edited 2 times in total.
atomicrc11
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Re: Recommended Car Insurance Limits?

Post by atomicrc11 »

Definitely check with your state to see if your home is protected. In my state you are automatically protected for $125k in equity in your home. If you file a declaration of homestead, then you are protected up to $500k of equity. Take the amount of home equity, subtract the amount protected by law in your state, subtract the amount protected in 401k's and IRA's and add in any other assets (cars, boats, etc.). That is the net worth which you need to protect. That should determine your umbrella.
ThreeScreens88
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Re: Recommended Car Insurance Limits?

Post by ThreeScreens88 »

anoop wrote: Sat Jul 10, 2021 9:58 pm
Random Poster wrote: Wed Mar 24, 2021 1:49 pm I also have a $1M umbrella policy.
...
Investible net worth is $4M+, house is paid off, car is a 2009 Japanese SUV.
I thought the general consensus is that size of umbrella policy should be equal to net worth.
I don’t believe that’s the consensus at all. If there’s a consensus, it would be to cover what you imagine to be a realistic amount of risk, irrespective of (or at least not primarily tied to) net worth. For most people, that’s unlikely to be more than 2 or 3 million.
OpenMinded1
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Re: Recommended Car Insurance Limits?

Post by OpenMinded1 »

Random Poster wrote: Wed Mar 24, 2021 8:02 pm
HomeStretch wrote: Wed Mar 24, 2021 2:21 pm I don’t hold a higher auto limit than required by the umbrella as my understanding is that any excess auto coverage isn’t additive to the total covered by the auto/umbrella. For example, if the required auto limit was $300k and my umbrella limit is $1 million, increasing my auto limit to $500k doesn’t increase my overall combined coverage by $200k.
I guess USAA does it differently, because after calling them three times and talking to three different representatives, they all say that the umbrella is additive to the underlying auto coverage.
I just talked to a rep from Progressive about this. I asked her the question several different ways, but she wouldn't come right out and say whether it was additive or not. It's like she wasn't allowed to say for sure. She said it kicks in after my home and/or auto liability coverage is exhausted, but wouldn't say whether it was additive. Does anybody know whether it is typically additive or not?
fsax
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Re: Recommended Car Insurance Limits?

Post by fsax »

AlienGrrrl wrote: Sat Jul 10, 2021 7:47 pm ...one other massively important thing (for me) in auto insurance is UM/UIM (Uninsured and underinsured motorist coverage)
Thanks AlienGrrrl! I do have that rider, since it was very inexpensive and adds additional protection. You just never know...
fsax
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Re: Recommended Car Insurance Limits?

Post by fsax »

TexasPE wrote: Sat Jul 10, 2021 7:48 pm
Your comfort level. This just happened in our city (and could happen to anyone)

https://www.beaumontenterprise.com/insi ... 300029.php

over $100K in damages
Yikes! Hitting a propane tank--now THAT'S some lousy luck!

regarding "Your comfort level" → As much as I'd like to be covered in the event that I'm found 'at-fault' in a 76-car pileup if there's ice on the highway in January, that level of coverage is likely to be prohibitively expensive [and not overly likely to be needed]
fsax
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Re: Recommended Car Insurance Limits?

Post by fsax »

Some great food for thought in here. That kind of good discussion is what I was hoping to see! Thanks to OpenMinded1 and sesq and anoop and atomicrc11 and ThreeScreens88 for the enlightening discussion.

Also, thanks to oldfort for recommending the interesting discussion on this thread: viewtopic.php?f=2&t=349198
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TexasPE
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Re: Recommended Car Insurance Limits?

Post by TexasPE »

fsax wrote: Mon Jul 12, 2021 10:52 am
TexasPE wrote: Sat Jul 10, 2021 7:48 pm
Your comfort level. This just happened in our city (and could happen to anyone)

https://www.beaumontenterprise.com/insi ... 300029.php

over $100K in damages
Yikes! Hitting a propane tank--now THAT'S some lousy luck!

regarding "Your comfort level" → As much as I'd like to be covered in the event that I'm found 'at-fault' in a 76-car pileup if there's ice on the highway in January, that level of coverage is likely to be prohibitively expensive [and not overly likely to be needed]
Understood - however, to me NO umbrella insurance is 'penny wise, pound foolish'. Many years ago a friend's elderly father did not hear a fire engine's (turnable ladder truck) siren and horn and pulled into the intersection - causing the fire engine to crash. The truck was totaled ($750K) and two fireman injured,

I personally look on it as having enough coverage to "do the right thing' morally should someone be injured, disabled or killed through my negligence. Money won't replace what they lost but can help mitigate the situation.

It's more than dollars and cents to me...YMMV.
At 20: I cared what everyone thought about me | At 40: I didn't give a damn what anyone thought of me | Now that I'm 60: I realize that no one was really thinking about me at all | Winston Churchill (?)
OpenMinded1
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Re: Recommended Car Insurance Limits?

Post by OpenMinded1 »

TexasPE wrote: Mon Jul 12, 2021 11:14 am
fsax wrote: Mon Jul 12, 2021 10:52 am
TexasPE wrote: Sat Jul 10, 2021 7:48 pm
Your comfort level. This just happened in our city (and could happen to anyone)

https://www.beaumontenterprise.com/insi ... 300029.php

over $100K in damages
Yikes! Hitting a propane tank--now THAT'S some lousy luck!

regarding "Your comfort level" → As much as I'd like to be covered in the event that I'm found 'at-fault' in a 76-car pileup if there's ice on the highway in January, that level of coverage is likely to be prohibitively expensive [and not overly likely to be needed]
Understood - however, to me NO umbrella insurance is 'penny wise, pound foolish'. Many years ago a friend's elderly father did not hear a fire engine's (turnable ladder truck) siren and horn and pulled into the intersection - causing the fire engine to crash. The truck was totaled ($750K) and two fireman injured,

I personally look on it as having enough coverage to "do the right thing' morally should someone be injured, disabled or killed through my negligence. Money won't replace what they lost but can help mitigate the situation.

It's more than dollars and cents to me...YMMV.
Delete
Last edited by OpenMinded1 on Mon Jul 12, 2021 1:30 pm, edited 2 times in total.
fsax
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Re: Recommended Car Insurance Limits?

Post by fsax »

TexasPE wrote: Mon Jul 12, 2021 11:14 am
fsax wrote: Mon Jul 12, 2021 10:52 am
TexasPE wrote: Sat Jul 10, 2021 7:48 pm
Your comfort level. This just happened in our city (and could happen to anyone)

https://www.beaumontenterprise.com/insi ... 300029.php

over $100K in damages
Yikes! Hitting a propane tank--now THAT'S some lousy luck!

regarding "Your comfort level" → As much as I'd like to be covered in the event that I'm found 'at-fault' in a 76-car pileup if there's ice on the highway in January, that level of coverage is likely to be prohibitively expensive [and not overly likely to be needed]
Understood - however, to me NO umbrella insurance is 'penny wise, pound foolish'. Many years ago a friend's elderly father did not hear a fire engine's (turnable ladder truck) siren and horn and pulled into the intersection - causing the fire engine to crash. The truck was totaled ($750K) and two fireman injured,

I personally look on it as having enough coverage to "do the right thing' morally should someone be injured, disabled or killed through my negligence. Money won't replace what they lost but can help mitigate the situation.

It's more than dollars and cents to me...YMMV.
I am considering a $1M umbrella plan for exactly these kinds of reasons. I do have some savings but an ordinary car and no house (though, based on my lifestyle, nobody would think I had anything--so the likelihood of a huge lawsuit is probably low). I am concerned about protecting my assets. However, I also want to make sure I have adequate coverage in case I do something boneheaded that results in harm to someone else. But if I remember my policy correctly, I believe I'll have to raise my auto coverage anyway before I'm eligible for umbrella :/

I don't want to be underinsured, but I also lead a low-risk lifestyle and know full well that the overwhelmingly likely outcome of the insurance is that I'm simply making the insurance company richer.
sesq
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Re: Recommended Car Insurance Limits?

Post by sesq »

OpenMinded1 wrote: Sat Jul 10, 2021 9:38 pm Not sure, but I don't think tenants by entirety protects the equity in your house from personal liability lawsuits. Might be something to look into.
Well, I do have an umbrella also. But that said, tenants by entirity both my wife and I would need to have the judgement against us for the creditor to make a claim, otherwise they are denying the innocent party enjoyment of the property.
onedayretired
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Re: Recommended Car Insurance Limits?

Post by onedayretired »

I will try to keep this simple:

1. Carry insurance liability limits to cover your net worth plus a little cushion. That includes property damage. If you think about it you can get into a severe accident and hurt someone, that is the bodily injury component of the auto insurance. But you can also get into a multi car accident where you are at fault and not have enough limits. Think of an accident where you hit a BMW, motorhome, mini van, and limo.

2. Carry matching UM/UIM (uninsured motorist and under insured motorist) - so if the person who hits you does not have insurance or inadequate limits YOUR policy stands in the shoes of the other person and pays your claims. So you have a 1st party claim and a 3rd party claim against YOUR OWN insurance company. Always get matching UM/UIM in an umbrella and don't buy it if its not offered.

3. Regarding the comment that the insurance company will settle and the claimant come after you.... it doesn't work that way. The insurer will endeavor to secure a release of all liability for them and you. The insurer will not settle and leave you high and dry - Ive never heard of this, but while not impossible I would say extremely rare. The key here is to carry high enough limits.

4. Top tier person insurers: Chubb (they can do a single combined limit of liability - PD/BI, I believe up to 10M eliminating the need for an umbrella); USAA, will need an umbrella; Amica, will need an umbrella; I would also check PURE Insurance.

Lastly, no one like to pay insurance premiums but the basic premise is that you are transferring your risk to an insurance company, and there are definitely differences in insurers. You can you to your State Insurance Commissioners website and research customer complaints by company. You will find that the discount insurers have the most complaints. You get what you paid for......
Lente
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Re: Recommended Car Insurance Limits?

Post by Lente »

How does your net worth have anything to do with the amount of umbrella to carry?

Umbrella covers risk of liability. It seems you’d want to cover whatever is viewed as probable or possible claims.

If I have 100k in assets and I cause 1m in liability I’d need 1m risk mitigation not to lose my 100k?

If I had 2m in assets and I cause 1m in liability I’d need the same mitigation to not lose my 1m of my 2m?

Is the question not what sort of claim amounts are likely?

If I have higher NW I may be more likely to be targeted for a lawsuit but wouldn’t someone just come for umbrella + NW?

Is there any case data or other objective study or argument that may inform the discussion?
OpenMinded1
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Re: Recommended Car Insurance Limits?

Post by OpenMinded1 »

onedayretired wrote: Mon Jul 12, 2021 9:25 pm I will try to keep this simple:

1. Carry insurance liability limits to cover your net worth plus a little cushion. That includes property damage. If you think about it you can get into a severe accident and hurt someone, that is the bodily injury component of the auto insurance. But you can also get into a multi car accident where you are at fault and not have enough limits. Think of an accident where you hit a BMW, motorhome, mini van, and limo.

2. Carry matching UM/UIM (uninsured motorist and under insured motorist) - so if the person who hits you does not have insurance or inadequate limits YOUR policy stands in the shoes of the other person and pays your claims. So you have a 1st party claim and a 3rd party claim against YOUR OWN insurance company. Always get matching UM/UIM in an umbrella and don't buy it if its not offered.

3. Regarding the comment that the insurance company will settle and the claimant come after you.... it doesn't work that way. The insurer will endeavor to secure a release of all liability for them and you. The insurer will not settle and leave you high and dry - Ive never heard of this, but while not impossible I would say extremely rare. The key here is to carry high enough limits.

4. Top tier person insurers: Chubb (they can do a single combined limit of liability - PD/BI, I believe up to 10M eliminating the need for an umbrella); USAA, will need an umbrella; Amica, will need an umbrella; I would also check PURE Insurance.

Lastly, no one like to pay insurance premiums but the basic premise is that you are transferring your risk to an insurance company, and there are definitely differences in insurers. You can you to your State Insurance Commissioners website and research customer complaints by company. You will find that the discount insurers have the most complaints. You get what you paid for......
Regarding #2 above. I'm asking this because I don't know the answer. Not being snarky. 1) I have excellent healthcare insurance, and my wife has very good healthcare insurance and short-term and long-term disability insurance. We also have long-term care insurance. So if one of us is in an accident with a UM/UIM, and it's not our fault, why should we worry about the other driver being UM/UIM? Seems like our insurance would pay for care. 2) I guess the other aspect of this is damage to our vehicle. We have two vehicles. Neither is worth more than $15K. Why would I need to make sure the umbrella policy's UM/UIM coverage matches my auto policy UM/UIM coverage?

We have UM/UIM coverage with our auto insurance of 100/300/100. I'm wondering why it's important to get umbrella coverage with matching coverage.
Soon2BXProgrammer
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Re: Recommended Car Insurance Limits?

Post by Soon2BXProgrammer »

OpenMinded1 wrote: Tue Jul 13, 2021 8:02 am Regarding #2 above. I'm asking this because I don't know the answer. Not being snarky. 1) I have excellent healthcare insurance, and my wife has very good healthcare insurance and short-term and long-term disability insurance. We also have long-term care insurance. So if one of us is in an accident with a UM/UIM, and it's not our fault, why should we worry about the other driver being UM/UIM? Seems like our insurance would pay for care. 2) I guess the other aspect of this is damage to our vehicle. We have two vehicles. Neither is worth more than $15K. Why would I need to make sure the umbrella policy's UM/UIM coverage matches my auto policy UM/UIM coverage?

We have UM/UIM coverage with our auto insurance of 100/300/100. I'm wondering why it's important to get umbrella coverage with matching coverage.
Do you ever transport your children? grandchildren? friends? etc. what policy will pay for their care if an UM/UIM motorist plows into your car? if your UM/UIM coverage is lacking... (and don't have a umbrella that coordinates)

Also health insurance will try to deny claims and want to bill auto insurance for medical related to car accidents.
Chartered Financial Consultant (ChFC®) -- However I am not your advisor.
OpenMinded1
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Re: Recommended Car Insurance Limits?

Post by OpenMinded1 »

Soon2BXProgrammer wrote: Tue Jul 13, 2021 8:06 am
OpenMinded1 wrote: Tue Jul 13, 2021 8:02 am Regarding #2 above. I'm asking this because I don't know the answer. Not being snarky. 1) I have excellent healthcare insurance, and my wife has very good healthcare insurance and short-term and long-term disability insurance. We also have long-term care insurance. So if one of us is in an accident with a UM/UIM, and it's not our fault, why should we worry about the other driver being UM/UIM? Seems like our insurance would pay for care. 2) I guess the other aspect of this is damage to our vehicle. We have two vehicles. Neither is worth more than $15K. Why would I need to make sure the umbrella policy's UM/UIM coverage matches my auto policy UM/UIM coverage?

We have UM/UIM coverage with our auto insurance of 100/300/100. I'm wondering why it's important to get umbrella coverage with matching coverage.
Do you ever transport your children? grandchildren? friends? etc. what policy will pay for their care if an UM/UIM motorist plows into your car? if your UM/UIM coverage is lacking... (and don't have a umbrella that coordinates)

Also health insurance will try to deny claims and want to bill auto insurance for medical related to car accidents.
Very seldom transport anyone else. (We don't have any children by the way.) I don't see how health insurance could successfully deny a claim. Seems like they might go back after paying a claim and try to get insurance to reimburse them. Admittedly, I'm not a lawyer and don't have any personal experience with accidents involving a UM/UIM.
Soon2BXProgrammer
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Re: Recommended Car Insurance Limits?

Post by Soon2BXProgrammer »

OpenMinded1 wrote: Tue Jul 13, 2021 8:11 am
Soon2BXProgrammer wrote: Tue Jul 13, 2021 8:06 am
OpenMinded1 wrote: Tue Jul 13, 2021 8:02 am Regarding #2 above. I'm asking this because I don't know the answer. Not being snarky. 1) I have excellent healthcare insurance, and my wife has very good healthcare insurance and short-term and long-term disability insurance. We also have long-term care insurance. So if one of us is in an accident with a UM/UIM, and it's not our fault, why should we worry about the other driver being UM/UIM? Seems like our insurance would pay for care. 2) I guess the other aspect of this is damage to our vehicle. We have two vehicles. Neither is worth more than $15K. Why would I need to make sure the umbrella policy's UM/UIM coverage matches my auto policy UM/UIM coverage?

We have UM/UIM coverage with our auto insurance of 100/300/100. I'm wondering why it's important to get umbrella coverage with matching coverage.
Do you ever transport your children? grandchildren? friends? etc. what policy will pay for their care if an UM/UIM motorist plows into your car? if your UM/UIM coverage is lacking... (and don't have a umbrella that coordinates)

Also health insurance will try to deny claims and want to bill auto insurance for medical related to car accidents.
Very seldom transport anyone else. (We don't have any children by the way.) I don't see how health insurance could successfully deny a claim. Seems like they might go back after paying a claim and try to get insurance to reimburse them. Admittedly, I'm not a lawyer and don't have any personal experience with accidents involving a UM/UIM.
I'm not saying the health insurance company wont pay it.. just that they will say its not them, and it can be messy.

Not sure what your NW is... but 100/300/100 without an umbrella is pretty low.... Hit a tesla & benz in a 3 card accident, and one person has neck issues and you could blow through all that coverage. if you dont' have money, then ok. but i had 100/300/100 20 years ago as an low level enlisted person, and lots of things are more expensive now... UM/UIM matching coverage for a higher policy limit isn't that expensive.
Chartered Financial Consultant (ChFC®) -- However I am not your advisor.
OpenMinded1
Posts: 329
Joined: Wed Feb 05, 2020 9:27 am

Re: Recommended Car Insurance Limits?

Post by OpenMinded1 »

Soon2BXProgrammer wrote: Tue Jul 13, 2021 8:17 am
OpenMinded1 wrote: Tue Jul 13, 2021 8:11 am
Soon2BXProgrammer wrote: Tue Jul 13, 2021 8:06 am
OpenMinded1 wrote: Tue Jul 13, 2021 8:02 am Regarding #2 above. I'm asking this because I don't know the answer. Not being snarky. 1) I have excellent healthcare insurance, and my wife has very good healthcare insurance and short-term and long-term disability insurance. We also have long-term care insurance. So if one of us is in an accident with a UM/UIM, and it's not our fault, why should we worry about the other driver being UM/UIM? Seems like our insurance would pay for care. 2) I guess the other aspect of this is damage to our vehicle. We have two vehicles. Neither is worth more than $15K. Why would I need to make sure the umbrella policy's UM/UIM coverage matches my auto policy UM/UIM coverage?

We have UM/UIM coverage with our auto insurance of 100/300/100. I'm wondering why it's important to get umbrella coverage with matching coverage.
Do you ever transport your children? grandchildren? friends? etc. what policy will pay for their care if an UM/UIM motorist plows into your car? if your UM/UIM coverage is lacking... (and don't have a umbrella that coordinates)

Also health insurance will try to deny claims and want to bill auto insurance for medical related to car accidents.
Very seldom transport anyone else. (We don't have any children by the way.) I don't see how health insurance could successfully deny a claim. Seems like they might go back after paying a claim and try to get insurance to reimburse them. Admittedly, I'm not a lawyer and don't have any personal experience with accidents involving a UM/UIM.
I'm not saying the health insurance company wont pay it.. just that they will say its not them, and it can be messy.

Not sure what your NW is... but 100/300/100 without an umbrella is pretty low.... Hit a tesla & benz in a 3 card accident, and one person has neck issues and you could blow through all that coverage. if you dont' have money, then ok. but i had 100/300/100 20 years ago as an low level enlisted person, and lots of things are more expensive now... UM/UIM matching coverage for a higher policy limit isn't that expensive.
Okay. Thanks for that. I plan to get umbrella insurance within the next few days. Hope I can bundle with my current homeowners and auto, and that they offer an umbrella that includes UM/UIM. In other words, hope I don't have to switch everything just to be able to bundle with umbrella that includes UM/UIM coverage.

Your example seems more appropriate for other aspects of my auto coverage and prospective umbrella coverage, not UM/UIM coverage.
Soon2BXProgrammer
Posts: 2412
Joined: Mon Nov 24, 2014 11:30 pm

Re: Recommended Car Insurance Limits?

Post by Soon2BXProgrammer »

OpenMinded1 wrote: Tue Jul 13, 2021 8:31 am
Soon2BXProgrammer wrote: Tue Jul 13, 2021 8:17 am
OpenMinded1 wrote: Tue Jul 13, 2021 8:11 am
Soon2BXProgrammer wrote: Tue Jul 13, 2021 8:06 am
OpenMinded1 wrote: Tue Jul 13, 2021 8:02 am Regarding #2 above. I'm asking this because I don't know the answer. Not being snarky. 1) I have excellent healthcare insurance, and my wife has very good healthcare insurance and short-term and long-term disability insurance. We also have long-term care insurance. So if one of us is in an accident with a UM/UIM, and it's not our fault, why should we worry about the other driver being UM/UIM? Seems like our insurance would pay for care. 2) I guess the other aspect of this is damage to our vehicle. We have two vehicles. Neither is worth more than $15K. Why would I need to make sure the umbrella policy's UM/UIM coverage matches my auto policy UM/UIM coverage?

We have UM/UIM coverage with our auto insurance of 100/300/100. I'm wondering why it's important to get umbrella coverage with matching coverage.
Do you ever transport your children? grandchildren? friends? etc. what policy will pay for their care if an UM/UIM motorist plows into your car? if your UM/UIM coverage is lacking... (and don't have a umbrella that coordinates)

Also health insurance will try to deny claims and want to bill auto insurance for medical related to car accidents.
Very seldom transport anyone else. (We don't have any children by the way.) I don't see how health insurance could successfully deny a claim. Seems like they might go back after paying a claim and try to get insurance to reimburse them. Admittedly, I'm not a lawyer and don't have any personal experience with accidents involving a UM/UIM.
I'm not saying the health insurance company wont pay it.. just that they will say its not them, and it can be messy.

Not sure what your NW is... but 100/300/100 without an umbrella is pretty low.... Hit a tesla & benz in a 3 card accident, and one person has neck issues and you could blow through all that coverage. if you dont' have money, then ok. but i had 100/300/100 20 years ago as an low level enlisted person, and lots of things are more expensive now... UM/UIM matching coverage for a higher policy limit isn't that expensive.
Okay. Thanks for that. I plan to get umbrella insurance within the next few days. Hope I can bundle with my current homeowners and auto, and that they offer an umbrella that includes UM/UIM. In other words, hope I don't have to switch everything just to be able to bundle with umbrella that includes UM/UIM coverage.

Your example seems more appropriate for other aspects of my auto coverage and prospective umbrella coverage, not UM/UIM coverage.
paying for UM/UIM is peanuts on a policy... it would be penny wise and pound foolish to decline it on your auto policy.
Chartered Financial Consultant (ChFC®) -- However I am not your advisor.
OpenMinded1
Posts: 329
Joined: Wed Feb 05, 2020 9:27 am

Re: Recommended Car Insurance Limits?

Post by OpenMinded1 »

delete
OpenMinded1
Posts: 329
Joined: Wed Feb 05, 2020 9:27 am

Re: Recommended Car Insurance Limits?

Post by OpenMinded1 »

Soon2BXProgrammer wrote: Tue Jul 13, 2021 8:33 am
OpenMinded1 wrote: Tue Jul 13, 2021 8:31 am
Soon2BXProgrammer wrote: Tue Jul 13, 2021 8:17 am
OpenMinded1 wrote: Tue Jul 13, 2021 8:11 am
Soon2BXProgrammer wrote: Tue Jul 13, 2021 8:06 am

Do you ever transport your children? grandchildren? friends? etc. what policy will pay for their care if an UM/UIM motorist plows into your car? if your UM/UIM coverage is lacking... (and don't have a umbrella that coordinates)

Also health insurance will try to deny claims and want to bill auto insurance for medical related to car accidents.
Very seldom transport anyone else. (We don't have any children by the way.) I don't see how health insurance could successfully deny a claim. Seems like they might go back after paying a claim and try to get insurance to reimburse them. Admittedly, I'm not a lawyer and don't have any personal experience with accidents involving a UM/UIM.
I'm not saying the health insurance company wont pay it.. just that they will say its not them, and it can be messy.

Not sure what your NW is... but 100/300/100 without an umbrella is pretty low.... Hit a tesla & benz in a 3 card accident, and one person has neck issues and you could blow through all that coverage. if you dont' have money, then ok. but i had 100/300/100 20 years ago as an low level enlisted person, and lots of things are more expensive now... UM/UIM matching coverage for a higher policy limit isn't that expensive.
Okay. Thanks for that. I plan to get umbrella insurance within the next few days. Hope I can bundle with my current homeowners and auto, and that they offer an umbrella that includes UM/UIM. In other words, hope I don't have to switch everything just to be able to bundle with umbrella that includes UM/UIM coverage.

Your example seems more appropriate for other aspects of my auto coverage and prospective umbrella coverage, not UM/UIM coverage. The UM/UIM has to do with accidents where someone else is at fault, and they are a UM/UIM.
paying for UM/UIM is peanuts on a policy... it would be penny wise and pound foolish to decline it on your auto policy.
[/quote]
OpenMinded1
Posts: 329
Joined: Wed Feb 05, 2020 9:27 am

Re: Recommended Car Insurance Limits?

Post by OpenMinded1 »

OpenMinded1 wrote: Tue Jul 13, 2021 8:37 am
Soon2BXProgrammer wrote: Tue Jul 13, 2021 8:33 am
OpenMinded1 wrote: Tue Jul 13, 2021 8:31 am
Soon2BXProgrammer wrote: Tue Jul 13, 2021 8:17 am
OpenMinded1 wrote: Tue Jul 13, 2021 8:11 am

Very seldom transport anyone else. (We don't have any children by the way.) I don't see how health insurance could successfully deny a claim. Seems like they might go back after paying a claim and try to get insurance to reimburse them. Admittedly, I'm not a lawyer and don't have any personal experience with accidents involving a UM/UIM.
I'm not saying the health insurance company wont pay it.. just that they will say its not them, and it can be messy.

Not sure what your NW is... but 100/300/100 without an umbrella is pretty low.... Hit a tesla & benz in a 3 card accident, and one person has neck issues and you could blow through all that coverage. if you dont' have money, then ok. but i had 100/300/100 20 years ago as an low level enlisted person, and lots of things are more expensive now... UM/UIM matching coverage for a higher policy limit isn't that expensive.
Okay. Thanks for that. I plan to get umbrella insurance within the next few days. Hope I can bundle with my current homeowners and auto, and that they offer an umbrella that includes UM/UIM. In other words, hope I don't have to switch everything just to be able to bundle with umbrella that includes UM/UIM coverage.

Your example seems more appropriate for other aspects of my auto coverage and prospective umbrella coverage, not UM/UIM coverage. The UM/UIM has to do with accidents where someone else is at fault, and they are a UM/UIM.
paying for UM/UIM is peanuts on a policy... it would be penny wise and pound foolish to decline it on your auto policy.
[/quote]

Thanks again. I definitely won't decline it on my auto policy. Just wondering whether I really need matching coverage amounts in my umbrella. I'll see if I can get an umbrella policy with matching UM/UIM coverage that I can bundle with my current auto and home and take it from there.
Soon2BXProgrammer
Posts: 2412
Joined: Mon Nov 24, 2014 11:30 pm

Re: Recommended Car Insurance Limits?

Post by Soon2BXProgrammer »

OpenMinded1 wrote: Tue Jul 13, 2021 8:44 am
Thanks again. I definitely won't decline it on my auto policy. Just wondering whether I really need matching coverage amounts in my umbrella. I'll see if I can get an umbrella policy with matching UM/UIM coverage that I can bundle with my current auto and home and take it from there.
in umbrella land... you need "underlying coverage", if your umbrella need 250/500 of underlying coverage, then you would have to set your liaiblity limits to it, and you UM/UIM to it, to get it to cover after the underlying coverage.
Chartered Financial Consultant (ChFC®) -- However I am not your advisor.
OpenMinded1
Posts: 329
Joined: Wed Feb 05, 2020 9:27 am

Re: Recommended Car Insurance Limits?

Post by OpenMinded1 »

OpenMinded1 wrote: Tue Jul 13, 2021 8:37 am
Soon2BXProgrammer wrote: Tue Jul 13, 2021 8:33 am
OpenMinded1 wrote: Tue Jul 13, 2021 8:31 am
Soon2BXProgrammer wrote: Tue Jul 13, 2021 8:17 am
OpenMinded1 wrote: Tue Jul 13, 2021 8:11 am

Very seldom transport anyone else. (We don't have any children by the way.) I don't see how health insurance could successfully deny a claim. Seems like they might go back after paying a claim and try to get insurance to reimburse them. Admittedly, I'm not a lawyer and don't have any personal experience with accidents involving a UM/UIM.
I'm not saying the health insurance company wont pay it.. just that they will say its not them, and it can be messy.

Not sure what your NW is... but 100/300/100 without an umbrella is pretty low.... Hit a tesla & benz in a 3 card accident, and one person has neck issues and you could blow through all that coverage. if you dont' have money, then ok. but i had 100/300/100 20 years ago as an low level enlisted person, and lots of things are more expensive now... UM/UIM matching coverage for a higher policy limit isn't that expensive.
Okay. Thanks for that. I plan to get umbrella insurance within the next few days. Hope I can bundle with my current homeowners and auto, and that they offer an umbrella that includes UM/UIM. In other words, hope I don't have to switch everything just to be able to bundle with umbrella that includes UM/UIM coverage.

Your example seems more appropriate for other aspects of my auto coverage and prospective umbrella coverage, not UM/UIM coverage. The UM/UIM has to do with accidents where someone else is at fault, and they are a UM/UIM.
paying for UM/UIM is peanuts on a policy... it would be penny wise and pound foolish to decline it on your auto policy.
[/quote]

Just found out UM/UIM would raise $1M umbrella coverage $166 per year. That's for $1M in UM/UIM coverage. The only amount offered. For 2M it would raise it $229. Not sure if that's for $1M or $2M in UM/UIM coverage. That's bundled auto, home, and umbrella with Progressive.
oldfort
Posts: 2685
Joined: Mon Mar 02, 2020 8:45 pm

Re: Recommended Car Insurance Limits?

Post by oldfort »

Soon2BXProgrammer wrote: Tue Jul 13, 2021 8:06 am
OpenMinded1 wrote: Tue Jul 13, 2021 8:02 am Regarding #2 above. I'm asking this because I don't know the answer. Not being snarky. 1) I have excellent healthcare insurance, and my wife has very good healthcare insurance and short-term and long-term disability insurance. We also have long-term care insurance. So if one of us is in an accident with a UM/UIM, and it's not our fault, why should we worry about the other driver being UM/UIM? Seems like our insurance would pay for care. 2) I guess the other aspect of this is damage to our vehicle. We have two vehicles. Neither is worth more than $15K. Why would I need to make sure the umbrella policy's UM/UIM coverage matches my auto policy UM/UIM coverage?

We have UM/UIM coverage with our auto insurance of 100/300/100. I'm wondering why it's important to get umbrella coverage with matching coverage.
Do you ever transport your children? grandchildren? friends? etc. what policy will pay for their care if an UM/UIM motorist plows into your car? if your UM/UIM coverage is lacking... (and don't have a umbrella that coordinates)

Also health insurance will try to deny claims and want to bill auto insurance for medical related to car accidents.
Health insurance doesn't deny claims because it's an auto accident. They might have subrogation rights against the at-fault driver, and might be able to make a claim against your UM/UIM. There is no situation where someone with health insurance doesn't have their medical bills covered, subject to normal copayments and coinsurance amounts.
OpenMinded1
Posts: 329
Joined: Wed Feb 05, 2020 9:27 am

Re: Recommended Car Insurance Limits?

Post by OpenMinded1 »

oldfort wrote: Tue Jul 13, 2021 9:39 pm
Soon2BXProgrammer wrote: Tue Jul 13, 2021 8:06 am
OpenMinded1 wrote: Tue Jul 13, 2021 8:02 am Regarding #2 above. I'm asking this because I don't know the answer. Not being snarky. 1) I have excellent healthcare insurance, and my wife has very good healthcare insurance and short-term and long-term disability insurance. We also have long-term care insurance. So if one of us is in an accident with a UM/UIM, and it's not our fault, why should we worry about the other driver being UM/UIM? Seems like our insurance would pay for care. 2) I guess the other aspect of this is damage to our vehicle. We have two vehicles. Neither is worth more than $15K. Why would I need to make sure the umbrella policy's UM/UIM coverage matches my auto policy UM/UIM coverage?

We have UM/UIM coverage with our auto insurance of 100/300/100. I'm wondering why it's important to get umbrella coverage with matching coverage.
Do you ever transport your children? grandchildren? friends? etc. what policy will pay for their care if an UM/UIM motorist plows into your car? if your UM/UIM coverage is lacking... (and don't have a umbrella that coordinates)

Also health insurance will try to deny claims and want to bill auto insurance for medical related to car accidents.
Health insurance doesn't deny claims because it's an auto accident. They might have subrogation rights against the at-fault driver, and might be able to make a claim against your UM/UIM. There is no situation where someone with health insurance doesn't have their medical bills covered, subject to normal copayments and coinsurance amounts.
Yes. Thanks for the info. That's what I thought. Also, think umbrella is a good idea for me, but I'm not convinced that I absolutely need UM/UIM coverage on my umbrella in addition to with my auto coverage like OneDayRetired states above. He says nobody should get umbrella that doesn't include UM/UIM. I haven't heard his rationale yet. (Another poster has been defending UM/UIM on an umbrella policy.)

I have raised my auto coverage to 250K/500K for UM/UIM, but leaning toward not paying extra for getting it with umbrella. Like I said, 1) I have excellent healthcare insurance (primary and secondary), and my wife has very good healthcare insurance and short-term and long-term disability insurance. We also have long-term care insurance. So if one of us is in an accident with a UM/UIM, and it's not our fault, why should we worry about the other driver being UM/UIM? Seems like our insurance would pay for our care. We very seldom transport anybody in our vehicles, and we don't have any kids. 2) I guess the other aspect of this is damage to our vehicle. We have two vehicles. Neither is worth more than $15K. Why would I need to make sure the umbrella policy's UM/UIM coverage matches my auto policy UM/UIM coverage?

Finally, seems like the probability of us needing more that $250K/$500K in UM/UIM coverage seems pretty low. Would need to have someone other than my wife or I in the car. Would need to be involved in an accident that isn't our fault. The accident would have to involve property damage claims or injury claims, to someone in our car other than my wife or I, over $250K/$500K. Neither one of us has been involved in an auto accident for over 30 years, and they were very minor - no injuries, very little property damage.
afan
Posts: 6009
Joined: Sun Jul 25, 2010 4:01 pm

Re: Recommended Car Insurance Limits?

Post by afan »

For us, increasing the umbrella coverage has been much cheaper than raising the auto limits. Also provides coverage for incidents that would not be under an auto policy. So simple decision.

Apparently, this depends on some combination of your carrier, your location and your specific circumstances. Some on bogleheads have reported that it is cheaper to increase protection on the auto policy than to increase umbrella. Each person has to check for their own policies.

In the states that permit tenants by entirety ownership, the home would be protected for claims against only one member of the couple. It would not be protected for claims against both members of the couple. The details vary by state, so you need to check for your state.

Protection of retirement assets varies across states. It differs between different types of retirement plans. It differs between bankruptcy cases and non bankruptcy liability claims. Because these interact to determine whether one should pursue bankruptcy and how much protection one has outside of it, the answers are complicated. If you really want to get it right you need help from an expert attorney in this field, which does not come cheap. Given the cost of umbrella coverage, buying more insurance could easily be cheaper than paying for hours of time from a high level asset protection expert to calculate exactly how much of your assets would be protected in each set of circumstances.

There have been many discussions here about how much umbrella to buy. No resolution. In the past year, I think, WCI had an asset protection attorney on the podcast. When asked the question, he gave a casual answer of $3M but did not dwell on how he came up with that figure. Although it has information for everyone, WCI is aimed at doctors and other high income professionals. The amount of umbrella to buy might be lower for people who lack the incomes and assets of physicians.
We don't know how to beat the market on a risk-adjusted basis, and we don't know anyone that does know either | --Swedroe | We assume that markets are efficient, that prices are right | --Fama
OpenMinded1
Posts: 329
Joined: Wed Feb 05, 2020 9:27 am

Re: Recommended Car Insurance Limits?

Post by OpenMinded1 »

afan wrote: Wed Jul 14, 2021 8:35 am For us, increasing the umbrella coverage has been much cheaper than raising the auto limits. Also provides coverage for incidents that would not be under an auto policy. So simple decision.

Apparently, this depends on some combination of your carrier, your location and your specific circumstances. Some on bogleheads have reported that it is cheaper to increase protection on the auto policy than to increase umbrella. Each person has to check for their own policies.
I had to increase from 100K/300K to 250K/500K to get the umbrella insurance that can be bundled with my auto and homeowners. So it didn't really come down to a decision of what would be cheaper. I had to increase auto to get the umbrella. Didn't really feel like going thru the hassle of getting different auto and/or homeowners - especially homeowners. Probably should have had 250/500 anyway.
talzara
Posts: 1785
Joined: Thu Feb 12, 2009 7:40 pm

Re: Recommended Car Insurance Limits?

Post by talzara »

OpenMinded1 wrote: Wed Jul 14, 2021 8:50 am
afan wrote: Wed Jul 14, 2021 8:35 am For us, increasing the umbrella coverage has been much cheaper than raising the auto limits. Also provides coverage for incidents that would not be under an auto policy. So simple decision.

Apparently, this depends on some combination of your carrier, your location and your specific circumstances. Some on bogleheads have reported that it is cheaper to increase protection on the auto policy than to increase umbrella. Each person has to check for their own policies.
I had to increase from 100K/300K to 250K/500K to get the umbrella insurance that can be bundled with my auto and homeowners. So it didn't really come down to a decision of what would be cheaper. I had to increase auto to get the umbrella. Didn't really feel like going thru the hassle of getting different auto and/or homeowners - especially homeowners. Probably should have had 250/500 anyway.
You're talking about an insurer that has a higher attachment point for umbrella insurance. The post you quoted is talking about increasing primary policy limits above the attachment point.

Most insurers offer $1 million liability limits on auto and homeowners insurance. A few offer $2 million liability limits. If you have a deeply discounted policy, increasing primary limits could cost less than buying an umbrella policy. (The prices also have to be adjusted for losing the stacking.)

When you need more than $2 million, umbrella becomes the only option.
fsax
Posts: 8
Joined: Sat Jul 10, 2021 12:25 pm

Re: Recommended Car Insurance Limits?

Post by fsax »

Thank you all for giving me a variety of perspectives, and much food for thought! These replies have been very helpful in teaching me how to evaluate my situation!
JD2775
Posts: 943
Joined: Thu Jul 09, 2015 10:47 pm

Re: Recommended Car Insurance Limits?

Post by JD2775 »

fsax wrote: Sat Jul 10, 2021 1:19 pm Not a homeowner, so I think that makes me ineligible for an umbrella policy [Guess I'd have to check with my ins. provider--which is State Farm, if that makes a difference].
I rent and have an umbrella policy. Honestly I barely drive anymore at all (I have been working from home since pre-Covid) but the added insurance of the $1 million dollar umbrella for $130/year still seems worth it to me. Peace of mind for when I do travel.
ncbill
Posts: 1084
Joined: Sun Jul 06, 2008 4:03 pm
Location: Western NC

Re: Recommended Car Insurance Limits?

Post by ncbill »

OpenMinded1 wrote: Wed Jul 14, 2021 7:48 am
oldfort wrote: Tue Jul 13, 2021 9:39 pm
Soon2BXProgrammer wrote: Tue Jul 13, 2021 8:06 am
OpenMinded1 wrote: Tue Jul 13, 2021 8:02 am Regarding #2 above. I'm asking this because I don't know the answer. Not being snarky. 1) I have excellent healthcare insurance, and my wife has very good healthcare insurance and short-term and long-term disability insurance. We also have long-term care insurance. So if one of us is in an accident with a UM/UIM, and it's not our fault, why should we worry about the other driver being UM/UIM? Seems like our insurance would pay for care. 2) I guess the other aspect of this is damage to our vehicle. We have two vehicles. Neither is worth more than $15K. Why would I need to make sure the umbrella policy's UM/UIM coverage matches my auto policy UM/UIM coverage?

We have UM/UIM coverage with our auto insurance of 100/300/100. I'm wondering why it's important to get umbrella coverage with matching coverage.
Do you ever transport your children? grandchildren? friends? etc. what policy will pay for their care if an UM/UIM motorist plows into your car? if your UM/UIM coverage is lacking... (and don't have a umbrella that coordinates)

Also health insurance will try to deny claims and want to bill auto insurance for medical related to car accidents.
Health insurance doesn't deny claims because it's an auto accident. They might have subrogation rights against the at-fault driver, and might be able to make a claim against your UM/UIM. There is no situation where someone with health insurance doesn't have their medical bills covered, subject to normal copayments and coinsurance amounts.
Yes. Thanks for the info. That's what I thought. Also, think umbrella is a good idea for me, but I'm not convinced that I absolutely need UM/UIM coverage on my umbrella in addition to with my auto coverage like OneDayRetired states above. He says nobody should get umbrella that doesn't include UM/UIM. I haven't heard his rationale yet. (Another poster has been defending UM/UIM on an umbrella policy.)

I have raised my auto coverage to 250K/500K for UM/UIM, but leaning toward not paying extra for getting it with umbrella. Like I said, 1) I have excellent healthcare insurance (primary and secondary), and my wife has very good healthcare insurance and short-term and long-term disability insurance. We also have long-term care insurance. So if one of us is in an accident with a UM/UIM, and it's not our fault, why should we worry about the other driver being UM/UIM? Seems like our insurance would pay for our care. We very seldom transport anybody in our vehicles, and we don't have any kids. 2) I guess the other aspect of this is damage to our vehicle. We have two vehicles. Neither is worth more than $15K. Why would I need to make sure the umbrella policy's UM/UIM coverage matches my auto policy UM/UIM coverage?

Finally, seems like the probability of us needing more that $250K/$500K in UM/UIM coverage seems pretty low. Would need to have someone other than my wife or I in the car. Would need to be involved in an accident that isn't our fault. The accident would have to involve property damage claims or injury claims, to someone in our car other than my wife or I, over $250K/$500K. Neither one of us has been involved in an auto accident for over 30 years, and they were very minor - no injuries, very little property damage.
Can't find the link now but online I saw one attorney recommended $1 million UM/UIM coverage on the auto policy since umbrella policies usually have an "own household" coverage exemption.

I.e. you or your spouse is driving & one or more of your kids is badly injured in an accident...not covered by umbrella.

No kids in my household anymore so I left our auto policy UM/UIM coverage at $500k/$500k.
Boatguy
Posts: 113
Joined: Fri Apr 19, 2019 7:54 pm

Re: Recommended Car Insurance Limits?

Post by Boatguy »

UM will also pay for things like lost wages, modifications to homes due to permanent disability, and other intangibles that medical insurance will not.
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