Why are auto property damage limits set so low?

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?

If you have assets to protect, you should get an umbrella policy. Some companies only need $100k/$300k underlying limits, while others need $250k/$500k. It would be easier if you reached out to an independent agent rather than quoting online.

BrianCopland said:
If you have assets to protect, you should get an umbrella policy. Some companies only need $100k/$300k underlying limits, while others need $250k/$500k. It would be easier if you reached out to an independent agent rather than quoting online.

Yes, definitely get an umbrella policy, but I agree with you. $100k is too low, especially with cars having new tech and pricey parts. In New York, Allstate offers higher limits for just a little extra per vehicle.

They need approval because they want to make sure you’re not trying to get higher limits for bad reasons.

Washington said:
They need approval because they want to make sure you’re not trying to get higher limits for bad reasons.

Wealthy people usually use high net worth insurance companies for this kind of coverage.

You’re probably looking at the wrong companies. Some will offer up to $1 million for property damage. Or you could look into CSL (Combined Single Limit) policies, which combine bodily injury and property damage into one limit. Some companies offer limits up to $500k or $1 million for this.

I’ve never had trouble getting over $100k. I easily got $250k/$500k when I asked.

Most people with $100k vehicles have their own coverage, so their insurance would handle it, and they’ll chase the at-fault party’s insurer later. It could raise premiums for everyone, but that’s better than people being uninsured.

A lot of people don’t have a ton of assets, so $100k is usually enough. You’re just looking to be insured properly for your level of assets.

Just because it needs to go to underwriting doesn’t mean they see you as high risk. It probably depends on where you live, too. In some places, most people carry just the state minimum, and in others, people have higher limits.

Alpha said:
I’ve never had trouble getting over $100k. I easily got $250k/$500k when I asked.

Most people with $100k vehicles have their own coverage, so their insurance would handle it, and they’ll chase the at-fault party’s insurer later. It could raise premiums for everyone, but that’s better than people being uninsured.

A lot of people don’t have a ton of assets, so $100k is usually enough. You’re just looking to be insured properly for your level of assets.

Just because it needs to go to underwriting doesn’t mean they see you as high risk. It probably depends on where you live, too. In some places, most people carry just the state minimum, and in others, people have higher limits.

You mentioned $250k/$500k, but OP is more concerned about hitting multiple cars or a building. They might want to look into a single limit policy if they can’t get more than $100k for property damage.

zaddockhearns said:

Alpha said:
I’ve never had trouble getting over $100k. I easily got $250k/$500k when I asked.

Most people with $100k vehicles have their own coverage, so their insurance would handle it, and they’ll chase the at-fault party’s insurer later. It could raise premiums for everyone, but that’s better than people being uninsured.

A lot of people don’t have a ton of assets, so $100k is usually enough. You’re just looking to be insured properly for your level of assets.

Just because it needs to go to underwriting doesn’t mean they see you as high risk. It probably depends on where you live, too. In some places, most people carry just the state minimum, and in others, people have higher limits.

You mentioned $250k/$500k, but OP is more concerned about hitting multiple cars or a building. They might want to look into a single limit policy if they can’t get more than $100k for property damage.

Sorry, I meant $250k/$500k/$250k.

zaddockhearns said:

Alpha said:
I’ve never had trouble getting over $100k. I easily got $250k/$500k when I asked.

Most people with $100k vehicles have their own coverage, so their insurance would handle it, and they’ll chase the at-fault party’s insurer later. It could raise premiums for everyone, but that’s better than people being uninsured.

A lot of people don’t have a ton of assets, so $100k is usually enough. You’re just looking to be insured properly for your level of assets.

Just because it needs to go to underwriting doesn’t mean they see you as high risk. It probably depends on where you live, too. In some places, most people carry just the state minimum, and in others, people have higher limits.

You mentioned $250k/$500k, but OP is more concerned about hitting multiple cars or a building. They might want to look into a single limit policy if they can’t get more than $100k for property damage.

Allstate wrote me $300k online.

Alpha said:
I’ve never had trouble getting over $100k. I easily got $250k/$500k when I asked.

Most people with $100k vehicles have their own coverage, so their insurance would handle it, and they’ll chase the at-fault party’s insurer later. It could raise premiums for everyone, but that’s better than people being uninsured.

A lot of people don’t have a ton of assets, so $100k is usually enough. You’re just looking to be insured properly for your level of assets.

Just because it needs to go to underwriting doesn’t mean they see you as high risk. It probably depends on where you live, too. In some places, most people carry just the state minimum, and in others, people have higher limits.

I haven’t heard yet if my request for over $100k will be approved, so maybe it’s not an issue. But the fact that I had to call and wait for approval made me think it’s not common. What I don’t get is why more people wouldn’t want more than $100k in coverage.

It’s frustrating because it slows down comparison shopping when you have to wait days for each company to give you a final quote.

Even if the owner of a $100k vehicle has their own collision coverage, wouldn’t their insurance company still come after you to recover the costs? Especially if they know you have assets?

I live in Idaho, and our minimum property damage limit is $15k.

@Smith
In California, it’s just $5,000, which wouldn’t even cover a headlight and some fender damage on certain cars.

@Smith
I’m in a more populated state, and I’ve been able to get $500k online without a problem. Maybe it’s an Idaho thing? The population density is lower, so there’s less risk of multi-car accidents, but there might be a higher risk for comprehensive claims (like wildlife or natural disasters).

@Smith
A lot of people don’t have much to protect, so $100k is more than enough for them. Many people live paycheck to paycheck, rent, and don’t have significant assets.

I understand the frustration, but you should be able to get all your quotes at once and wait for the final numbers.

If the other party has their own coverage, their insurance will pursue the at-fault person’s insurer. If the at-fault party has no assets, they may just accept the policy limits, even if it’s less than the damages. If they do have assets, they might refuse the limits and sue, but that’s rare.

Most state minimums are crazy low (often under $25k). When people ask for much higher limits, companies will often ask for more info or verify assets.

Another option is using high-net-worth insurance companies that specialize in this. You could also work with an agent who will handle the shopping around for you, and it won’t cost extra.

Smith said:
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?

You should check out insurers that offer single limit policies. We have a $1 million single liability limit with Amica.

Smith said:
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?

A lot of companies have a limit, but then you can get an umbrella policy on top of that. If you have a $5 million net worth, you’d get a $5 million umbrella to cover it.

Smith said:
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?

Most companies see $100k as enough to support an umbrella policy. An umbrella adds $1 million or more on top of your regular coverage.

Not many people would need more than $100k without also raising their bodily injury limits. If it’s easy to do $100k in property damage, imagine how much worse it would be if you seriously hurt someone in an accident.

For most, it makes more sense to get an umbrella than just raising property damage limits.

If you hit a school bus, the cost of the bus isn’t your biggest problem.

Smith said:
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?

The odds of a property damage claim going over $100k are very low. Higher coverage is really for people who are extremely risk-averse or have the money to pay for it.

@hannah
How is that? It seems like a bad accident involving an expensive car could easily exceed $100k.

I know the risk of a major accident is low, but $100k in property damage doesn’t seem that unlikely to me.