A policy limit is the maximum amount of money your insurer will pay you after an insured loss. The limits are set by the policyholder at the time the insurance policy is set up.
But, how do policy limits work if I have a liability claim? If you have an insured loss that involves a third-party, (e.g. car accident) the maximum amount paid out by your insurer goes to the third-party for medical expenses and/or legal fees.
Since you’re required to choose your policy limits, you may need guidance. While options depend on what type of insurance you’re dealing with, if you’re not clear on what limits to set, contact one of our insurance brokers in Fort McMurray.