Notify your insurance company of the claim against you. Assuming you have liability coverage, your insurer will appoint a lawyer to defend you. Don't be discouraged by the fact that the claimant is claiming more than the limits of your policy. There is nothing that precludes the claimant from claiming any amount he wants, but that does not mean he is entitled to that amount. Even if you are liable, there is good chance the claim will settle for policy limits or less. However, if you think there is a realistic chance of the opposing side seeking damages beyond the policy limits, you may want to consider consulting an asset protection attorney and discuss your options.
This response is for information purpose only and does not constitute a legal advice. This response does not create an attorney-client relationship.
Anyone can seek any substantial amount. But to be successful is a different story. That being said, contact your insurance company and give them notice of such. I would suggest addressing your limits so you can prevent this scenario in the future!
To protect yourself from having to pay out of pocket for part of the claim beyond your policy limit, the main objective is to make sure your insurance company quickly evaluates the case, including the plaintiff's damages, and puts forward a policy limit offer if that is justified. Many if not most plaintiffs will take that offer and leave you alone if it is made within a reasonable time. They may ask for proof of your financial situation if you claim that you cannot afford to give them anything substantial out of pocket, so if that is indeed your situation, cooperate with your insurance company and provide a declaration and other information promptly. Last but not least, if you feel your insurance company is not acting in your best interest, talking to an independent lawyer (not the insurance company lawyer). You might even be entitled to have the insurance company pay for that separate representation.
Your first step should be to contact your insurance carrier and inform them of the situation. After that, your insurance carrier should provide you with an attorney with whom you should discuss your case. Best of luck.
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