Per-Person Liability for Auto-Insurance

Insurance companies can limit liability in automobile insurance policies by setting a per person limitation on the amount of benefits that will be paid under the policy for bodily injury to or the death of one person per accident. Whether the limitation is stated as person or each person makes no difference. Such limitations on liability are necessary. Without them, an insurance company could be at risk for more than the funds that it has to pay its claims. The insured pays a certain amount, called a premium, based in part upon the policy limits.

If an insurance policy provides a limit of $100,000 for each person and $300,000 for each occurrence and two passengers in an insured's automobile are injured in a single accident, then each injured person could recover from the insured's liability policy no more than $100,000. If four passengers in the insured's automobile are injured in a single accident, then each injured person could recover from the insured's liability policy no more than $100,000, however, the total recovery for all four injured persons could not exceed $300,000.

A per person-per accident policy limitation must be clear. Any ambiguity in an insurance policy is resolved in favor of the injured person and against the insurance company. If an ambiguity exists, an injured person could recover more than $100,000 if a single accident injures two or more persons and the total recovery does not exceed the per accident limitation of $300,000.

Many states require automobile owners to obtain insurance that provides a minimum amount of liability coverage per person and per accident. Some states impose maximum limits on the amount of per person coverage an insured may request.

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