What is a policy limit?

A policy limit is the maximum amount of money that an insurance company will provide for a certain claim. In Mississippi, a policy limit is set for each type of insurance. For example, if an auto insurance company provides coverage for $30,000 per accident, then that is the policy limit for that type of claim. If a person in Mississippi is in an accident and the damages are more than the policy limit, then the insured would be responsible for covering the remaining amount. Generally, policy limits are determined by the insurance company and are based on the type of claim and level of coverage chosen by the insured. Policy limits can also be increased by requesting additional coverage from the insurance company.

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