When driving in the USA, how do I insure against large third party claims?
I've been looking into travelling to the USA (CA specifically) later this year, and hiring a car whilst I'm there.
As I understand the American legal system, if I should get into an accident and be found at fault, then I'd be liable for any and all medical expenses incurred by the other driver as a result of the accident.
The mandatory auto insurance for the state is some amount in the tens of thousands, and most rental firms offer some supplemental liability insurance going up to ~,000,000.
This leaves me quite concerned, because if the other driver suffers, say, a spinal injury and spends 3 months in hospital, m starts to look like pocket change compared to the the bills US hospitals can produce.
So what steps can you take to safeguard yourself from being liable for everything past m?
For reference, I'm from the UK where all car insurance is required to provide unlimited liability for 3rd party claims (c.f. the Great Heck rail crash).
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Just because the other side claims that much money doesn't mean they'll get that much. Your liability insurance company has a duty to defend you in any lawsuits, and will try to reach a low settlement with the other side even before it goes to trial. Your insurance company also has a duty to try to get the lowest settlement possible. If the other side sees that you don't have much money (I am not sure if U.S. courts can get your foreign money), then they are likely settle for a low amount.
If you are looking for high limits of liability, the product you're looking for is a personal umbrella policy.
A personal umbrella policy is good for anyone with a low risk tolerance or high risk of being targeted in a lawsuit (e.g. high-net-worth individuals). They're pretty cheap because the risk of exceeding the underlying policy's limits (your chief concern) is actually pretty low.
You are free to get any amount of coverage that you feel is necessary. Two million dollars is quite common. You may end up paying much more proportionately for higher levels, because the insurance companies will wonder why you think you need it.
Remember that the kind of multi-million dollar accident you describe is very, very rare.
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