What exactly is liability coverage as it applies to your automobile insurance policy? Simply put, liability coverage kicks in if you are found to be at fault, either fully or partially, for a motor vehicle accident, and it provides coverage for those individuals who are injured or have damages as a result of that accident. This type of coverage is not intended to provide compensation to the at-fault policyholder if they, too, are injured or have property damage due to the accident. It only extends to the other driver or drivers when you as the policyholder are found to be totally responsible for the accident or found to be responsible at least to some extent.
First of all, drivers in the State of Florida, which is a no-fault state, are required to purchase certain limits of automobile insurance for their policy. One such required coverage is the Personal Injury Protection or PIP, coverage which provides payment to the policyholder for any of his or her injuries as a result of the auto accident no matter who is found to be at fault. But there is one important liability coverage which, while it is required in most of the other fifty states, is not required in Florida.
Frequently when a Florida driver is shopping around for or renewing an automobile insurance policy, their main focus is on coverage to provide protection to themselves. This type of coverage is obviously not liability coverage but rather the aforementioned required PIP coverage and the uninsured/underinsured motorist limits (not currently required in Florida). But equally important for adequate policyholder protection are the liability coverages that extend benefits to the other driver or drivers in the event that fault for the accident does not lie with them but rather with the policyholder. This includes important liability coverage such as Bodily Injury Liability insurance, referred to in the above paragraph, which is also referred to as BIL. Unfortunately, this type of coverage remains an optional policy purchase in Florida.
Bodily Injury Liability insurance coverage provides payment, up to the purchased policy limits, for injury or death to the other drivers in an automobile accident when the policyholder has been found to be totally or partially liable. It also extends coverage to any of the policyholder’s family members who currently reside with them, and, if the policyholder allows someone else to drive their vehicle and that person causes a motor vehicle accident which results in injury to others, BIL kicks in to compensate the injured for their injuries as well.
As stated above, in Florida BIL coverage is not required (unless you are a driver who previously was convicted of driving under the influence – then you are required to purchase BIL for your policy for a certain time after the conviction), and some policyholders choose to not add this liability coverage to their policy in an effort to spend less on the total premium cost of the policy. But BIL coverage, although it does provide protection to others as discussed above, actually is important coverage to protect the policyholder in the event that he or she becomes liable for an accident that causes injuries to others which result in claims for medical expenses and other damages. Basically, adding BIL coverage to your automobile policy is one way to protect your assets such as your home or homes, your other owned assets, and your savings and investments in the event you are sued by an individual injured in an accident for which you have been determined to be at fault.
The Florida Financial Responsibility Law sets forth that a vehicle owner who enjoys the privilege of operating his or her vehicle on the streets and roadways of Florida must do so with consideration for others and for the property of others and must be prepared to provide financial compensation for any injury to others or damage to their property that the vehicle owner may have caused. Having BIL on your automobile insurance policy can provide you with an initial line of valuable protection if you yourself are found to be at fault for injury to others.
Failing to add BIL to your automobile policy can potentially leave you and your assets wide open and vulnerable to a possible claim against your personal holdings from the other injured driver or drivers who, when they or their counsel realize that no BIL coverage exists, may very well decide they have no other option other to file a claim against you personally.
Initially, in motor vehicle accident cases where there is found to be no available BIL coverage, the injured party will likely request that an asset search be performed on you as the at-fault. Specifically, you would be required to truthfully itemize all of your assets such as your homes and other real estate holding along with vehicle owned and other private financial information. Depending on the amount of these assets, the injured party can then decide whether or not to bring a claim against the at-fault individual personally. Very often this results in a civil lawsuit being filed. It is important to remember that the insurance company holding the policy for the at-fault driver is not responsible for obtaining at attorney to represent them in the personal injury suit now filed against them. The policyholder who is being sued will need to retain appropriate counsel themselves and then of course be held personally responsible for any of the resulting legal fees and costs.
So far we have been discussing what might happen should you choose to not purchase BIL coverage. But should you make the wise decision to add BIL to your policy, it is also very important to consider the level of limits to buy. If you have substantial personal assets, the higher limits of BIL would provide much better protection.
And, speaking of liability protection, there is another line of liability coverage, one that is required for a Florida automobile insurance policy. This would be Property Damage Liability, also referred to as PDL. This coverage protects you for any damages to anyone’s property that stem from an accident that you caused. The current required PDL limit in Florida is ten-thousand dollars, but, again, choosing to purchase a higher limit will afford you and your assets greater protection as, should the damage exceed your purchased policy limits, you run a risk of being held personally responsible for the remainder of the damages.
