By: Kristopher Speegle, Allstate Insurance
A limit is one of the most important concepts to understand when you're considering an insurance policy. A coverage limit determines the most an insurance company will pay for a covered claim.
ARE THERE MULTIPLE LIMITS IN AN INSURANCE POLICY?
A typical insurance policy is a collection of coverages — and each coverage has a limit. So, you'll likely have multiple limits within one policy
For example, a car insurance policy that includes liability coverage, collision coverage, and comprehensive coverage will have three separate limits.
YOU CAN COUNT ON THE SPEEGLE AGENCY.
We can answer coverage questions and help you find ways to protect what matters most.
HOW ARE LIMITS DETERMINED?
How limits are determined depends on the type of coverage.
- Auto liability coverage limits are mandated by state law. Each state sets minimum limits drivers must purchase. Keep in mind, though, that this is just a starting point and you may want to increase your liability limits by purchasing more coverage, depending on your circumstances.
- Comprehensive and collision coverage limits are equal to the actual cash value of your vehicle at the time of the accident. In other words, if your car is totaled in a collision, your policy may pay up to the vehicle's current value, which takes into account depreciation.
- You choose your limits for other coverages, such as those for dwelling or personal property coverage. Your decision should be based on certain factors, such as the cost to repair, replace or rebuild your property, or the amount of money you would need after an accident. The limits you choose affect the amount you pay for coverage — the higher your limit, the higher your premium likely will be.
In the event of a covered claim, you may have to pay a deductible up front, and your insurance will help pay the rest — up to your coverage limits. You're responsible for anything beyond that.
Have questions about insurance limits? Give me a call today at 808.969.7767 or visit: http://hawaiiallstate.com/
ABOUT KRIS SPEEGLE:
Aloha, As an Allstate agent living in Hawaii for most my whole life, I know many local families. My knowledge and understanding of the people in this community help me provide the customer with an outstanding level of service. I love being an active member of our community with involvement in the Rotary of Hilo Bay (Board Member), Hawaii Island Chamber of Commerce, and Big Island Referral Network. I look forward to helping families like yours protect the things that are important – your family, home, car, retirement, and more.