Which of the following statements about liability insurance limits is accurate?

The statement indicating that the insurer is only responsible for the limit specified in the policy is accurate. This is a fundamental principle of liability insurance. Each insurance policy has specific coverage limits, which denote the maximum amount that the insurer will pay for covered claims. These limits are defined in the policy agreement and are critical in determining the insurer’s obligation when a claim is made.

If a loss occurs that exceeds the policy limit, the insured would be responsible for any additional amounts beyond what the insurer is obligated to pay. Therefore, understanding and managing these limits is crucial for individuals and businesses to ensure adequate protection against potential liabilities.

The other statements do not accurately reflect the principles governing liability insurance. For instance, an insurer does not pay all claimed amounts regardless of policy limits, nor can it unilaterally refuse to pay legitimate claims based on the terms of the agreement. Additionally, any adjustments to coverage limits typically require a specific process and are not made arbitrarily by the insured at any time. Understanding these aspects helps in making informed decisions regarding liability coverage.