I just got married and am working on combining my wife’s and my auto insurance. One thing I can’t figure out is why most auto insurance companies seem to cap their property damage liability coverage at $100k.
If you want more than that, you have to call in, and they put in a special request with their underwriting team. Then you have to wait 3-5 business days to see if it’s approved.
To me, $100k seems too low. With new cars hitting $50k or $60k these days, it wouldn’t take much to exceed that limit in a bad accident, especially if it involves multiple vehicles. And what if you hit a commercial truck with valuable cargo? There are a lot of scenarios where more than $100k in damage could happen.
Of course, the chance of this happening is low, and I’m not expecting to be in a crash that results in over $100k in damage. But that’s the whole point of insurance, right? To protect against those unlikely but disastrous events. My wife and I have a decent amount of assets that would be at risk if we’re only covered for $100k.
Am I missing something? When I asked for higher coverage, the agent made it seem unusual and said it would need underwriting approval. I even felt like they viewed me as higher risk just for asking for more than $100k.
Does the industry really see the risk of $100k+ damage as that small? Is there some regulation that keeps it at $100k? Or are people with more assets using different insurance companies that offer higher limits, and I’m just not aware of them?