Both your auto and homeowners insurance policy have a portion of coverage called "liability" protection....that's the part that protects you from being taken to the cleaners if you or one of your household members is responsible for injuring someone else or damaging their ride.
If you do injure someone else in a serious accident, who knows how high the victim's medical costs will be? With the cost of health care it could go into the gazillions, right? So should you carry a huge amount of liability for just such an occurrence?
Well, maybe not. The idea here of liability protection at it's very essence is for your financial protection in the event that you or one of your family members injurs another party. In other words, what you own is what you protect. So you should set your liability to the limit of what you own...your assets. For most people, their biggest asset is their house, then you can add other stuff like your cars, boats, vacation homes, your classic Johnny West cowboy action figure collection, and whatever else. This is the stuff injured people can potentially take away from you if you happen not to have enough liability to cover their injuries (No, Not My Johnny West action figure collection!!). On the other side of that coin, they cannot take from you what you do not have. So then the limit of your liability should be based on what you do have.
Unless you own absolutely nothing, you should never, never, never choose minimum state limits of liability. Take some time and add it all up, then check your policy limits. If they are not set where you think they should be set, call your agent and request your limits be raised. The difference in your premium will be minimal compared to other policy changes, like adding another car or driver to the policy. If you have young drivers in the house just starting out, your insurance company will match their liability with yours, so you need not worry about what your financial exposure may be for something your teen driver may do to someone else.
