Legal Question in Insurance Law in California

This appears to be a standard form letter from the insurance company that puts you on notice that it is always possible that the amount of money required to settle this claim may exceed the amount of the policy limits -- in your case $15,000 -- and that $15,000 is all the insurance company will pay. In the event it can not settle the case for $15,000 or less, it would be up to you to pay any amount in excess of $15,000.

The mistake you made, and many others make, is buying only the very minimum amount of liability protection required by the state to register the car. It's never wise to try saving money on auto liability coverage by buying the smallest policy limit. For a very small extra premium you undoubtedly could have bought a higher liability limit of $50,000 or $100,000 or $250,000 or even more. That gives you protection.

Had you done so you almost certainly would have been fully protected in this case. (While the claim here may be inflated, and the standing of the driver to sue for full damages may be questioned, the fact that there was minor property damage does not rule out a potentially serious injury to the people inside the car.) Who knows what will happen if the person inside the car was seriously injured and has a lawyer and the case goes to a jury and the jury decides that even though the property damage to the car was minor the the medical bills and lost wages and pain and suffering were greater than $15,000?

In this case you would be well served if you get independent counsel to advise you what you should do next.

The insurer is not entitled to see your assets, and from your question, you have not been assigned a defense lawyer. You should immediately get your own lawyer, who can tell the insurer you want the case settled within your policy limits. That requires it to act to protect you, not to play hardball with the plaintiff at your expense.

It may be that your lawyer's fees may have to be paid by the insurer, so make sure to get a lawyer who is familiar with personal injury claims and insurance law. Do it sooner rather than later.