What is "excess liability coverage" in auto insurance?

Excess liability coverage in auto insurance refers to additional liability limits that go beyond the standard limits set by a policy. This type of coverage provides extra financial protection if you are held responsible for damages or injuries to others that exceed your primary policy limits. For instance, if your standard liability coverage covers up to $300,000 and you cause an accident resulting in $500,000 in damages, excess liability coverage would step in to cover the difference.

By having this additional layer of protection, you lessen the risk of facing substantial out-of-pocket expenses in a lawsuit or settlement, ensuring better financial security in the event of serious accidents. This is particularly valuable for individuals with significant assets who want to safeguard their finances against large claims.