What is a statutory limit in an insurance policy?

A statutory limit in an insurance policy is a maximum amount of money an insurance company can legally pay out for a claim. In the state of Hawaii, this limit is set by the Hawaii Insurance Code. The statutory limit determines how much an insurance company must pay out in the event of an insurance claim. It is set by the state legislature and helps ensure that insurance companies are not overburdened by claims, allowing them to keep premiums low. For example, the Hawaii Insurance Code limits the amount an insurance company can pay out for medical expenses to $25,000 per person, and $50,000 per accident. This limit applies to all types of insurance policies, including health, auto, homeowners, and business insurance policies. If an individual were to incur medical expenses significantly higher than this amount, the insurance company would not be required to cover the additional costs. It is important for individuals to know the statutory limits set by the Hawaii Insurance Code when making an insurance claim. Knowing the limits can help individuals make sure they receive the full amount they are entitled to, as well as help them understand the coverage they will receive from their insurance policy before purchasing it.

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What is a statutory limit in an insurance policy?

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