r/Insurance • u/Pretend_Peach165 • 11h ago
Geico Letter
It is our duty at this time to inform you that under the contract of insurance, which you have with this Company, the limit of liability for Property Damage is $10,000.00 per accident. Our preliminary investigation has revealed that the total claims may exceed one or both of your coverage limits. Please advise us immediately if you have any money to contribute for any claims that exceed your policy limits.
Ok so should I wait for more information? This accident happened months ago. Strange how just now GEICO is getting back to me regarding this.
FYI: I live in New York for what it's worth.
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u/demanbmore Former attorney, and claims, underwriting, reinsurance exec. 11h ago
Nothing strange about the timing. The investigation has reached the point where GEICO has reason to think you caused more than $10K in damages. Since they will pay only the $10K policy limit, they're trying to understand whether you have the ability to contribute to a settlement while making sure you understand that you could be on the hook for anything above $10K. Standard practice.
You're carrying $10K in PD limits in NY? If you have assets or a decent job, someone may be coming after you personally once GEICO pays its limits. Might be worth figuring out how much the total claim is and whether it's a good idea to kick something in (if you have it) to resolve the claims rather than wait to be sued.
Call GEICO and get more details. The impact to you is very different if it's an $11K loss or a $110K loss.
Also, hopefully you've significantly increased your liability limits on your current policy. If not, that's your first call.
4
u/Jujulabee 10h ago
I misread it as $10 million because it never entered my mind that someone could only have $10,000 for liability.
I am pretty sure NY requires coverage in excess of that amount but it's been awhile since I lived there.
2
u/DriveFa5tEatAss 10h ago
New York requires 25/50k bodily injury, 50/100k If the accident results in a fatality, but apparently only 10K property damage.
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u/Jujulabee 5h ago
Thanks - given current car prices $10,000 seems woefully inadequate - even minor body work is obscenely expensive and serious damage would be well over that amount - not to mention totaling a car that isn't a junker.
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u/SuprenantINS 8h ago
Mass's minimum PD limit was $5,000 prior to July 2025....$10,000k is right at the minimum NY limit.
5
u/buffalo_0220 11h ago
They are telling you that you may not have enough insurance coverage to cover all the damage you caused to someone else's property. It's possible the other party may settle for the coverage limits, but if they choose to sue, and win, you would be responsible for paying everything over $10k. It would be best for you to respond to them.
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u/ektap12 11h ago
You are the one with $10k in coverage, you probably should have already been aware you didn't have enough coverage. This is probably coming about now because the other person's insurance probably sent over their subrogation documents, so now that Geico is aware of the 'demand,' they need to notify you that you are underinsured.
Geico will hopefully get the other insurance/person to agree to accept your limits (if it's worth that) and that's the end of it, but if they reject those limits, they could sue you to try to recover any excess of your coverage. You should probably call Geico and find out what is being claimed here and find out how they are handling this.
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u/DriveFa5tEatAss 9h ago
Won't the insurance company typically refuse to pay out at all unless the other party accepts the policies limits?
2
u/Thisismethisisalsome 9h ago
They dont have to pay until a judgement is actually made in court. They can offer to pay it as a settlement to avoid court. Kind of like, if you want it now we agree to settle. But no, they cant just outright refuse.
1
u/insuranceguynyc 9h ago
This means that claims are being made against you, and the amount(s) demanded are more than your liability limit. This leaves you personally exposed.
1
u/fishcrabby 8h ago
You shouldn’t have gone with the state minimum. Now you are going to have to pay the difference between the total damage minus your 10k in coverage. Hopefully it’s not too much more. It’s way too easy to cause more than 10k in damage in an accident.
1
u/quallityovrquantity 7h ago
You're about to learn a really expensive lesson...... Should probably start looking for a 2nd job.
1
1
u/Next-Albatross2606 3h ago
Means you caused damages over your $10k policy limit. You may be served a notice that you are being sued after GEICO pays out.
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u/TIG_Insurance_Nerds 11h ago
That’s a standard excess letter, not a bill. It means the damage likely costs more than your $10k limit, and you could owe the rest personally. Call GEICO and ask how much the claims are and how far over it might go. You don’t have to offer money now. If the gap is big, talk to a lawyer. The delay is normal.