What exactly is 10/20/10? The three numbers in 10/20/10 represent liability limits (in thousands).
- The first 10 represents the maximum coverage for bodily injury liability per person in one accident.
- The 20 represents the maximum coverage for bodily injury liability for one accident
- The second 10 represents the maximum coverage for property damage liability for one accident.
This means that in case of a car accident, your car insurance company will pay out $10,000 per person for injuries you caused in the accident, $20,000 for all injuries sustained by all people, and $10,000 for the property damage that you caused.
These are Florida’s minimum liability limits, however, they’re on the low side if you severely injure someone, hit multiple cars, or just an expensive vehicle. So what happens if your limits aren’t sufficient for the damage? Well, you and your assets are at risk because you may be personally responsible for the difference. For example, let’s say you were at fault in a car accident and the injured person’s medical bill totaled $30,000. You’d be required to pay the remaining $20,000 after the $10,000 limit. If you don’t have $20,000, you would be forced to liquidate property, savings, and other assets, or your future earnings could be attached, in order to make payments. It’s worth keeping in mind that companies that guarantee they’ll get the lowest rate typically do so by lowering your limits – essentially putting you at risk. You should always purchase car insurance liability limits that sufficiently account for your current assets, as well as your future net worth. How low is 10/20/10? The insurance industry’s recommended coverage amount is 100/300 for bodily injury liability coverage and a limit of at least $50,000 for property damage.
At Lakewood Financial Services, our local agents will sit with you and ascertain the proper limits to keep you and your family safe. We also offer a wide array of discounts to help keep costs down. Get your quote today!