First, you don't have to worry about the cost of a trial. Your insurance carrier is responsible for defending you and they will provide for and pay counsel to do that. I don't know what your limits of liability are but you are covered up to whatever those limits are. Also, if you have an Umbrella liability policy that should also provide protection. It's still possible that the case can settle, unless both parties are oceans apart.
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Your insurer has provided you with an attorney to defend this case. While that attorney is paid by the insurer, he works not for them but for you. You should definitely be running these questions by him as to value of the injured party's claim and your likely exposure. Their 'claim' does not necessarily represent the value of their injury. Your local attorney would also be in a position to tell you how to best protect your assets in the event of a hostile judgment.
A critical question; were your coverage limits offered, or did the insurer attempt to get a 'deal'? In most states, an insurer presented with 'clear liability' (I'm going to assume for the purpose of this question that liability is clearly against you -- but remember, the insurer's determination does not bind a jury, and you may have liability defenses that your lawyer can bring out at trial) and damages in excess of policy limits has a duty to offer the policy. If the insurer's holding back money and your lawyer determines that your exposure is at least the policy limits, it should be offered now.
Good luck -- schedule that meeting with your defense attorney as soon as possible.
Your insurance company has an obligation to defend you against the claim being made against you. You will not have to pay for trial costs or the attorney who defends you, as these expenses are borne by your insurance company.
You should direct your very specific questions to the attorney which has been appointed for you by your insurance company. If your attorney believes that there is a possibility or likelihood that a verdict will exceed your coverage, you may wish to retain your own personal counsel to help best protect your interests at trial and afterwards.
It appears that you may have been seriously underinsured for this particular accident. In this day and age, people can no longer rely on $25,000 or $50,000 worth of liability coverage. You should consult with an independent insurance agent or broker to determine what would be adequate coverage for your situation, given your net worth and assets. You may also find it beneficial to take out what is called "excess" insurance, which provides an umbrella of additional coverage over your primary coverage. While this will not help you with the current debacle, it certainly can help prevent a repeat in the future.
Mr. Lundeen is licensed to practice law in Florida and Vermont. The response herein is not legal advice and does not create an attorney/client relationship. The response is in the form of legal education and is intended to provide general information about the matter within the question. Oftentimes the question does not include significant and important facts and timelines that, if known, could significantly change the reply and make it unsuitable. Mr. Lundeen strongly advises the questioner to confer with an attorney in your state in order to insure proper advice is received.