I have a $50K limit, and while I'm not sure how much the damages are going to be, I can safely assume it will exceed this amount. Missouri-specific answers are preferred, thanks. I've been told that personal assets can be seized in some states while in others they are exempt. Are there ANY exemptions or is this an all-or-none thing? I would hope my house couldn't be.
You are correct- if your insurance company provides you with $50K in liability coverage AND a jury returns a verdict in excess of that amount, your personal assets are subject to attachment. Your policy only covers liability in the amount you purchased, along with costs of defense.
However, you are not without protection! You can hire an attorney yourself to demand that the insurance company settle the case within policy limits if the opportunity arises. If the insurance company refuses to settle and "gambles" with your assets, they are acting in bad faith. As such, you may be able to assign the bad faith claim you have against your insurance company to the plaintiff so that the insurance company's assets, not yours, are used to satisfy the judgment. If the plaintiff never demands a settlement within the policy limits, it is difficult to force the insurance company to settle. On the other hand, nothing precludes the insurance company from offering a settlement to protect you.
The wise choice is to purchase enough insurance to protect your assets. As a practical matter, executing on your personal assets is difficult. It is certainly not impossible, and not something to take lightly. Regardless, the insurance company has a duty to put you first, not their own interests. The money you spend with a personal attorney for advice will be worth the piece of mind you will get.
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Yes, if there is a verdict that exceeds your coverage. In the future, I advise my clients to get at least 100/300 coverage and for a marginal amount you can get an umbrella policy.
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The exemptions are set in the Missouri statutes. The most important one is marital assets. However a judgment against you could effectively keep you from selling your house later.
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