Carry both bodily injury and property damage liability insurance. They are designed to protect your assets if you cause an accident and are sued for negligence. Personal injury protection (PIP) covers only the people in the insured's car, not the people in the other car(s) involved in an accident. Select the "No Limitation on Lawsuit" or "No Threshold" option when renewing your policy. This option gives you the right to a jury trial if you are injured by another driver.
Take out an umbrella policy in addition to your standard auto insurance policy. Although it's expensive, an umbrella policy provides extra protection for your home and other assets in the event of a lawsuit.
Consider asking your insurance company to settle out of court. That way, they can negotiate a lower settlement, so it will be completely covered by your policy. If you go to court, you risk losing the case and having to pay a larger amount that could bankrupt you.
Retain an attorney if there is the slightest hint that you might be sued. The insurance company is less likely to pressure you to take a smaller settlement. Always keep in mind that insurance companies are in business for the same reason anyone else is--to make money. Tips & Warnings
- Liability coverage is not meant to cover the injured party's medical bills. That's for his insurance company to cover.
