A serious car accident can result in mounting medical expenses, lost income, rehabilitation costs, and other losses that quickly exceed the amount of insurance available under a driver’s standard auto policy. When that happens, finding out whether additional liability coverage is available can become an important part of the claim.
An excess liability coverage car accident claim may involve coverage that applies after the at-fault party’s primary insurance limits have been reached. When a car accident exceeds policy limits, additional coverage may be available through an umbrella, commercial, or rideshare policy, or through insurance held by another responsible party.
These additional sources of insurance can be important when the primary policy does not cover the injured person’s losses.
What Is Excess Liability Insurance?
Excess liability insurance, also called excess insurance, provides additional liability limits above an underlying policy. A driver may also have a personal umbrella policy, although its coverage and requirements may differ.
The underlying auto policy pays first. Excess coverage may apply once that policy reaches its limit.
How Primary and Excess Insurance Work Together
Every insurance policy has a limit on how much it will pay for a covered claim. When an accident exceeds the insurance policy limits, other available insurance may help cover the remaining losses.
Here’s how the different types of coverage may work:
| Insurance Layer | What It Does | When It May Apply |
| Primary Liability Insurance | Provides the first layer of liability coverage | Pays for the first covered claim up to applicable limits |
| Excess Insurance | Provides additional limits above designated underlying coverage | May pay after the required underlying limits are exhausted |
| Umbrella Insurance | Provides additional liability protection and may cover more than one underlying policy | Applies after required underlying coverage is exhausted subject to its own terms and exclusions |
When It May Apply: Pays for the first covered claim up to applicable limits
When It May Apply: May pay after the required underlying limits are exhausted
When It May Apply: Applies after required underlying coverage is exhausted subject to its own terms and exclusions
The order in which policies pay and the amount of coverage available depend on each policy’s terms. A second policy does not automatically mean more money is available for the claim. The policy must cover the accident, the person or business involved, and the type of loss being claimed.
California’s Minimum Auto Insurance May Not Cover a Serious Injury
The California Department of Insurance lists the minimum standard auto liability limits as:
- $30,000 for bodily injury or death to one person
- $60,000 for bodily injury or death to multiple people in one accident
- $15,000 for property damage
A serious accident can cause much higher losses. For example, a spinal cord injury, brain injury, amputation, or other severe injury may require hospital care, rehabilitation, future medical treatment, and help with daily activities. The injured person may also be unable to work or earn the same income as before the accident.
This is why California car accident insurance limits can become such an important issue in a high-value car accident claim. The available insurance may not cover all losses.
For more information about coverage requirements and options, see our guide to California auto insurance.
Example: A $1 Million Claim With Multiple Insurance Layers
Suppose an injured person has $1 million in recoverable damages after a serious crash.
The at-fault driver has $250,000 in applicable primary liability insurance and an excess policy providing an additional $1 million in coverage.
If both policies apply, the primary policy may pay the first $250,000. The excess policy may then cover additional losses, up to its own limit.
That is why an insurance coverage investigation should not stop after identifying one policy. A serious accident may involve multiple insurance policies or other sources of coverage.
Why Excess Coverage Matters in Catastrophic Injury and Wrongful Death Cases
A catastrophic injury claim or wrongful death claim can involve significant current and future losses. Depending on the circumstances, damages in a serious case may include:
- Medical expenses
- Future treatment and rehabilitation
- Lost wages and reduced future earning capacity
- Pain and suffering
- Permanent disability or disfigurement
- Other accident-related losses
- Wrongful death damages when a crash is fatal
The available insurance affects where compensation may come from. Determining serious car accident insurance coverage may require looking beyond the limits of the primary auto policy.
Excess Liability Insurance vs. Umbrella Insurance
Excess liability and umbrella insurance both provide additional protection, but they are not the same.
Excess auto liability coverage increases the limit of a particular policy. Umbrella insurance may provide coverage over several underlying policies and, depending on its terms, may cover some situations those policies do not.
In either case, the policy’s limits, exclusions, and other terms determine when coverage applies.
How Can Additional Insurance Be Found After an Accident?
An attorney investigating additional insurance after a car accident may review the policies covering the driver and vehicle, as well as the circumstances surrounding the crash. Depending on the facts, questions may include:
- Did the at-fault party have an excess or umbrella policy?
- Did someone else own the vehicle?
- Was the driver working at the time?
- Did an employer own or insure the vehicle?
- Was the driver using a rideshare or delivery platform?
- Could another person or business share responsibility for the crash?
- Does the injured person have applicable underinsured motorist coverage?
In some cases, an accident may also involve questions about the vehicle itself. California drivers dealing with repeated warranty-covered vehicle defects can learn more in our California Lemon Law guide.
An insurance declarations page shows key policy details, including coverage types and policy limits. However, other insurance policies may also apply to the accident.
Some accidents may involve additional coverage from a business or rideshare company. For example, learn more about Uber’s $1 million liability policy and coverage that may apply in car-sharing service accidents.
An insurance company may also send a reservation of rights letter while it determines whether the policy covers the claim.
What Happens When Damages Exceed All Available Insurance?
Even after identifying every applicable liability policy, a severe injury claim can exceed the combined coverage. Other potential sources of recovery may then need to be considered.
The injured person’s own underinsured motorist coverage may also help. The California Department of Insurance explains that this coverage can apply when the at-fault driver does not have enough insurance to cover the bodily injury damages.
Our California uninsured motorist accident guide provides more information about this type of coverage.
A claim may also involve another legally responsible person or business with separate insurance. That could include an employer, vehicle owner, or another party whose conduct contributed to the collision.
If insurance still does not cover the full amount of the claim, recovery from the at-fault party’s personal assets may sometimes be considered. The options depend on the person’s assets, the facts of the case, applicable law, and the costs of pursuing additional recovery.
Serious motorcycle accidents can raise many of the same insurance issues. Our California motorcycle accident settlement guide provides additional information about the claims process.
Talk to a California Car Accident Attorney About Available Insurance Coverage
When the at-fault driver’s insurance is not enough to cover serious injuries, other insurance may be available. This could include secondary liability insurance, an excess or umbrella policy, or coverage from another party responsible for the accident.
The Shirvanian Law Firm can investigate the accident and identify insurance that may apply to your claim. Learn more about our practice areas, or contact us for a free consultation about your California car accident.
