How Auto Policy Limits Work
Auto policy limits set the most an insurer will pay under a liability policy, and they usually come in three numbers. The first is the limit for injuries to one person, the second is the limit for all injuries in one crash and the third is the limit for property damage. So a policy described as 30/60/15 pays up to $30,000 for one injured person, $60,000 for everyone hurt in the crash and $15,000 for property. Anything above those caps has to come from somewhere else.
California Minimums
For policies issued or renewed on or after January 1, 2025, California’s minimum liability limits are 30/60/15. The California DMV lists those requirements. Older policies may still carry lower limits until renewal.
Many drivers buy only the minimum. Then a serious injury, such as a fracture that needs surgery, can exceed the per person limit quickly. That gap often shapes how a claim unfolds.
Per Person Auto Policy Limits
The per person limit caps payment for any single injured person. It usually covers all of that person’s injury losses, including medical bills, lost wages and pain and suffering. Some policies also treat a spouse’s loss of consortium claim as part of the same per person limit.
So even when a crash injures only one person, the per person cap applies. A claim worth more than that cap needs another source of payment.
Per Accident Limits
The per accident limit caps payment for everyone hurt in one crash. When a crash injures several people, they share that amount. For example, if three people each have serious injuries, the per accident limit may not cover them all, even if each person’s claim fits within the per person cap.
Insurers sometimes try to settle with some claimants first. Then little may remain for others. Therefore, injured people in multi victim crashes often benefit from coordinating with each other through their lawyers.
Property Damage Limits
Property damage coverage pays for vehicles and other property the insured driver damaged. It runs separately from injury limits. A total loss of a newer vehicle can exceed a low property limit, and that shortfall can affect the injured person too. Ask the adjuster how the property claim and the injury claim will proceed, since they often move on different schedules.
Finding Out the Limits
Insurers do not always share limits right away. Still, you can ask in writing. Some insurers disclose limits once they see records suggesting the claim may exceed them. Keep a copy of every request and response.
Also ask whether other policies apply. A driver may have an umbrella policy, a business policy or coverage through an employer. A borrowed car may bring the owner’s policy into the picture as well.
Your Own Coverage Fills Gaps
Your own policy may help when the other driver’s limits fall short. California Insurance Code section 11580.2 addresses uninsured and underinsured motorist coverage, which many policies include. Medical payments coverage is optional, though it can help with bills regardless of fault. For first party claims, see first party insurance claims.
Check your own declarations page now. Knowing your limits before a crash avoids surprises later.
Offers at the Auto Policy Limits
When an insurer offers its full limit, that offer usually signals that it sees the claim as worth at least that much. Accepting usually requires a release. Before signing, check how the release affects your rights against your own insurer and any other party. Also review liens from health plans and hospitals, since they come out of the same money.
Some policies require notice to your own insurer before you accept the other driver’s limit. Read that section and send notice in writing.
Limits and Medical Liens
Hospitals, health plans and government programs may claim part of a settlement. When the policy limit is small, those claims can take a large share. California law caps some liens and reduces others for attorney fees, depending on the type.
So ask each lienholder for a written statement and ask whether a reduction applies. For more on repayment, see California subrogation law.
Claims Above the Limits
A judgment can exceed the policy limit. In that case, the driver may owe the difference personally. In practice, many drivers cannot pay large judgments, so collection can be slow or impossible. Because of that, most claims focus on insurance sources first.
How Fault Affects What You Receive
Limits cap payment, yet fault still matters. California reduces a recovery by the injured person’s share of fault. So a claim worth more than the limit may still settle for less if both drivers share fault. For that rule, see California comparative negligence.
Questions to Ask About Auto Policy Limits
- What are the per person and per accident limits?
- How many people have made claims?
- Does any umbrella or business policy apply?
- What underinsured coverage do I carry?
Write down each answer with the date and the adjuster’s name. Those notes become a roadmap for the rest of the claim, and they help avoid missing a policy that could make a difference.
This article is general information, not legal advice. Laws change and every situation is different.