Don't expect your car insurance to act as life insurance if you're killed in an auto accident. If your heirs are paid anything, it won't be nearly as much as they're likely to get from a life insurance policy.
"Dying in an auto accident is only one way to die. You should always have life insurance," says Robert Katz, an Atlanta attorney. "I would not plan life insurance coverage through auto insurance."
Car insurance is meant to take care of your car -- and to help your family with funeral expenses if you're killed -- but not much more.
"The purpose of insurance is to financially bring you back to where you were before the loss," says Tim Dodge, director of research and media relations at Independent Insurance Agents and Brokers of New York.
Whether your survivors see any money at all depends on what kinds of coverage you have and who was at fault for the accident.
Liability coverage: Your own liability coverage would not pay your family after an accident. If you are killed in an accident another driver causes, his or her liability insurance would pay your family.
The payout is limited by how much coverage was purchased under the other driver's bodily injury liability policy. In some states, the minimum required coverage -- in some places as low as $12,500 -- would barely cover the costs of a funeral.
Medical expenses count against the total, reducing the potential payout.
While increasing your own liability coverage won't help your family if you are killed in an accident, the added protection could keep you from being sued if you cause a fatal accident.
Most drivers with assets to protect should carry coverage of at least $100,000. "Add-ons" for excess coverage can be bought for not much more. Katz, for example, says he pays an extra $136 every six months to increase his liability coverage to $1 million.
"Insurance gets cheaper the more you buy," Katz says. "They're unlikely to pay out those amounts, so they don't charge much for it."
Personal injury protection (PIP): Personal injury protection is available in no-fault states, paying regardless of who is to blame for the accident. Penny Gusner, consumer analyst for CarInsurance.com, says benefits vary widely.
In Michigan, for example, your family can get 85 percent of your income, up to $5,189 a month, in survivor benefits. The death benefit under Florida PIP law is only $5,000 -- and until a recent change in Florida law, survivors saw nothing if medical bills had already consumed their coverage.
"At least there was this one saving grace for families facing this type of catastrophe," says Russel Lazega, an attorney in Miami.
Accidental death benefit: Also called accidental death or accidental death indemnity, this optional coverage pays in a covered auto accident where you or a family member die from bodily injury causes, Gusner says. Without this coverage, your family may have to pay out-of-pocket for your death expenses.
Uninsured and underinsured motorist coverage: If you're hit and killed by an uninsured driver and you have this coverage, your estate will have to show that the other side was at fault to collect from your insurer, says Lazega. Your heirs could recover your loss of income and future loss of income, he says.
Uninsured motorist coverage is optional in Florida, for example, although Lazega says getting it is a good idea because about 25 percent of drivers in the state don't have the minimum personal injury protection coverage required by law.
Underinsured motorist bodily injury provides death coverage if you're killed by someone with insufficient insurance, but only up to the liability limit of your policy. (See "What you need to know about uninsured motorist.")
Go to court: Your survivors can sue the at-fault driver who killed you in a crash.
If the claim is for more than the insurance coverage amount, your heirs can go after the driver's assets, says Katz, who also recommends searching for other insurance policies that the driver may have, such as being insured by an employer if the accident happened while driving for work.
"You have to do it the old-fashioned way and either deal with their adjuster or drag them to court," says Lazega, adding that about half of the auto death cases he handles go to court.
What survivors can bring a claim for varies by state, says Shane Fischer, an attorney in Orlando, Fla. A surviving spouse in Florida, for example, can collect for pain and suffering, lost support and services, and lost companionship, Fischer says. If there isn't a surviving spouse, adult children can collect for pain and suffering, lost parental companionship, instruction, and guidance.
Life insurance is cheaper
Any lawsuit is a roll of the dice, and so is depending on the responsibility of your fellow motorists.
"In the end, if you want to make sure your family is provided for, buy life insurance. It's cheaper," Gusner says.
For example, a 20-year, $250,000 term policy for a healthy 30-year-old costs about $150 a year, according to LIMRA, an insurance trade association. (See "How to evaluate term life insurance.")