The concept of “policy limits discovery” refers to a claimant’s or defendant’s efforts to ascertain the insurance policy limits of the opposing party’s liability coverage.
Simply put: how much insurance coverage is available for a judgment? This matters because knowing the policy limits can affect settlement strategy, risk management, and whether one might pursue a judgment beyond the insurer’s limits (i.e., “excess exposure”).
Below is an overview of the legal framework for policy limit discovery, a look at how this plays out in a cross-section of U.S. states, and key practical considerations. This is not legal advice, but rather a summary of how the terrain looks across jurisdictions.
1. What is policy-limit discovery, and why does it matter?
At its core, policy limit discovery concerns the following types of questions:
Does the defendant have liability insurance?
What are the policy limits of that insurance (e.g., $100,000, $500,000, umbrella coverage)?
Are there excess policies (umbrella or secondary liability coverage) beyond the primary policy?
When must the insurer disclose this information: pre-suit (before a lawsuit) or only once litigation is underway?
Why it matters:
For plaintiffs, knowledge of policy limits helps assess settlement posture. If the policy limits are low, the potential recovery may be capped by the insurer’s willingness or legal obligations.
For defendants / insurers, policy-limit discovery affects how to manage exposure: if a policy limit is known, the insured may face excess judgment risk if settlement is refused.
For both sides, strategic implications: e.g., a plaintiff may tailor demand knowing insurance limits; a defendant may push to settle within or near limits to avoid excess risk.
The rules of civil procedure generally treat insurance agreements and policy limits as subject to discovery if relevant (for example under the federal Federal Rules of Civil Procedure Rule 26(a)(1)(A)(iv) which requires disclosure of “any insurance agreement under which an insurance business may be liable to satisfy all or part of a possible judgment…”).
However — what qualifies as “relevant”, when disclosure is required, and whether pre-litigation requests are permitted differs significantly from state to state.
2. State-by-state snapshots: Illustrative examples
Here are selected states to illustrate the variety of approaches to policy limit discovery. (This is illustrative; you’ll want to check the specific statute or case law in any given jurisdiction.)
California
In California, the statute permits a party to obtain discovery of the existence and contents of any agreement under which an insurance carrier may be liable to satisfy in whole or in part a judgment, or to reimburse for payments made to satisfy the judgment. This includes the insurer identity and the nature and limits of coverage. Thus, policy limits are discoverable once litigation is underway.
Connecticut
Connecticut takes a more proactive stance in automobile liability cases. Upon receiving a written request by an individual who alleges bodily injury or death caused by an insured under a private passenger automobile liability insurance policy, the insurer must provide written disclosure of the insured’s automobile insurance policy limits, “including.
Any applicable umbrella or excess liability insurance issued by the insurer.” Furthermore, in civil actions based on negligence, the defendant’s liability policy limits and whether the insurer has disclaimed its duty to indemnify may be subject to discovery upon written motion.
Delaware
Delaware allows pre-suit requests for policy limit disclosure in motor vehicle accident cases. A claimant (or their attorney) may before filing suit request in writing the insurer to disclose bodily injury limits of any motor vehicle liability policy applicable to an accident. The statute requires certain information from the claimant (e.g., accident date, names, police report).
Florida
Florida’s statute requires, at the request of the claimant, full disclosure of insurance information pre-suit. The insurer must produce a complete copy of the policy, disclose the limits, and known coverage defenses.
Georgia
Georgia does not require pre-litigation disclosure of policy limits. However, once litigation is underway, Georgia’s civil procedure allows discovery of the existence and contents of any insurance agreement under which a party may be liable.
Maine
In Maine, an insurer must provide the liability coverage limits to a claimant or the claimant’s attorney within 60 days of a written request; this covers motor vehicle liability insurance. Failure to comply can have consequences.
Louisiana
Louisiana does not require pre-litigation disclosure of policy limits. However, because it allows direct actions against carriers (i.e., the claimant may sue the insurer directly), the policy inevitably becomes part of the evidence in the case.
Kansas
Kansas has case law (Cropp v Woleslagel) holding that at a pre-trial conference, the court can order a defendant to disclose his liability policy limits as part of settlement discussions.
These examples show substantial variation: from mandatory pre-suit disclosure, to disclosure only once a suit is filed, to states where no special statute exists and the matter is handled via standard discovery rules.
3. Key themes & trends
Relevance and standard discovery rules
Across jurisdictions, it is often recognized that the existence of liability insurance and the policy limits are relevant to the subject-matter of litigation: e.g., the potential for the plaintiff to collect a judgment, and the risk borne by the defendant. Early cases noted that even if policy limits may not be admissible at trial for liability/causation, they may still be discoverable.
Pre-suit vs. post-suit
A major dividing line: whether disclosure is required before a lawsuit is filed (pre-suit) or only after the lawsuit commences. States like Florida, Maine, Delaware, and Connecticut provide pre-suit disclosure in certain contexts (often auto liability). Others (e.g., Georgia, Louisiana) do not.
Limits of discovery and protective concerns
Even where discovery is permitted, there are trends of limiting it on grounds of relevance, burden, privilege, or privacy. For example, some argue that policy limits expose the insured’s financial information or influence settlement unduly.
Strategic implications for settlement
Disclosure of policy limits can affect settlement dynamics. If a plaintiff knows that policy limits are low, the incentive may be to push for a settlement close to those limits (for fear of the opponent’s insolvency or judgment risk). Conversely, a defendant or insurer may be more willing to settle within limits to avoid excess‐judgment exposure.
Regulatory and statutory overlays
Some states have statutes that explicitly impose obligations on insurers to respond to claimant requests for policy limits, and impose timelines and sanctions for non-compliance (e.g., Maine). Others rely on broader civil procedure rules or case law.
4. Practical take-aways for practitioners (and claimants/defendants)
Check local statute/case law early: Because states differ so much, one of the first moves is to check whether the jurisdiction requires pre-suit disclosure of policy limits (and under what conditions).
Tailor request carefully: In jurisdictions requiring pre-suit disclosure, the request often must comply with statutory conditions (e.g., written request, provide accident details, claimant’s medical records, etc.). For example, Delaware requires a police report copy and other documentation.
Be timely with litigation: If the state does not permit pre-suit disclosure, initiating suit may open conventional discovery avenues for policy limits. But understanding when those limits become discoverable (and via what mechanism) is key.
Use information strategically: If you learn the policy limits, incorporate that knowledge into your settlement strategy. For example, if limits are low, you might pursue faster resolution; if high, you might press for more aggressive settlement or uncover excess policies.
Recognize insurance/coverage interplay: Discovering policy limits may also reveal issues of coverage, disclaimers, or excess insurance. This impacts settlement risk for both sides.
Anticipate objections: Opposing parties may object to disclosure based on relevance, undue burden, privacy or guess that limits are not “discoverable” without a suit. Being prepared with authority is crucial.
Document everything: When requesting disclosure, keep copies of written requests, track insurer responses (or non-responses), and if the state statute imposes timing obligations, monitor compliance.
5. Final thoughts
Policy limit discovery is a nuanced area of civil litigation that sits at the intersection of insurance law, discovery rules, and settlement strategy. While the federal rules (e.g., FRCP 26) provide a baseline for disclosure of insurance agreements, the real action is in the state laws and state court decisions that govern when and how limits must be disclosed — particular in the pre-litigation universe. Some states impose strong, proactive disclosure requirements (especially for automobile accidents), while others allow disclosure only after suit, and still others remain permissive or silent.
For claimants and defendants alike, the lesson is: don’t assume uniformity. Always check the jurisdictional rule, and understand the strategic consequences of discovering (or being asked to disclose) policy limits. Whether you’re assessing exposure or making settlement demands, knowledge of the insurance limits is often a decisive factor in how the case unfolds.
