“It is a good idea to increase your liability coverage limits if you can. There are a couple of reasons why an insurance company might care about this, though.
If you have an extensive claim history, an insurance company will want to look a little closer before approving very high limits or drastically increased limits.The company is responsible for paying up to your coverage limit in the event of a claim, so they want to look at the risk.
Some companies only offer up to certain limits based on how your policy is underwritten. Requesting limits higher than what you qualify for, based on their criteria, might prompt them to look more closely.
Perhaps they are inquiring so that they can offer you something that would suit your needs better, like an umbrella policy or a commercial or business policy.
If you are just doing some cost comparison, let them know so that they can offer the best options for you.