When you get behind the wheel, you likely think about safety... checking your mirrors and fastening your seatbelt. It's almost as important to think about financial protection. Car insurance is a type of personal insurance that covers certain financial risks and losses you might incur while driving. Liability car insurance is a specific type of car insurance that covers the financial losses of another person if you're at fault for an accident. Most states require some form of liability insurance. In this article, you'll discover what liability insurance covers, what it doesn't, why it's important, and how to find the best liability insurance for you.
What Is Liability Car Insurance?
Liability car insurance is a form of personal insurance that provides for the financial losses or bodily injury of the other party if you're involved in an accident. While collision and comprehensive insurance are optional, liability car insurance is mandated by most states, meaning you're legally required to carry liability insurance. Otherwise, you could face legal consequences, including fines, court fees, and the loss of your driver's license.
Bodily Injury Liability: What It Covers and Why It Matters
What is bodily injury liability insurance? Liability car insurance coverage laws mandate minimum limits for bodily injury liability. This means your liability coverage pays for the other person's medical expenses, pain and suffering, or lost wages up to a specific dollar limit set by state law. It's critical to remember that bodily injury liability is meant to protect you from other people's claims; it won't cover your medical bills. In concrete terms, if you rear-end another driver who is injured in the accident, liability protects you from their costly medical bills.
Property Damage Liability: What’s Protected?
While bodily injury liability protects you from other people's injury claims, property damage liability covers damage you cause to another person's physical property. This includes things like broken headlights, crushed fenders, or even damage to fences or walls. Maximum coverage amounts are written into the policy as mandated by state law.
Coverage Limits: How Much Liability Insurance Do You Need?
To decide how much liability insurance you need, you must first consult your state's law. Most states mandate minimum levels of liability coverage for both bodily injury and property damage. When you Google your state's policies, you'll find a shorthand like this: 25/50/25. The first number prescribes $25,000 for injuries per person, the second limits payout to $50,000 per accident for bodily injuries. The last number means you must maintain at least $25,000 worth of property damage liability coverage. Even so, as you calculate your coverage needs, remember that these dollar amounts pay for other people's damage - not your own. For full coverage car insurance, you'll need to go beyond the minimum liability insurance policy, adding additional coverages.
What Liability Car Insurance Does Not Cover
As the policyholder, liability car insurance protects you from the claims of other people, but it does not pay claims for damage or injury you incur. So if you cause a car crash and carry liability only car insurance, you'll need full coverage. Otherwise, you'll end up paying for your own medical bills and car repairs out of pocket. What is full coverage car insurance? Full coverage insurance includes liability, collision, and comprehensive coverage, which covers your losses as well.
Is Liability Insurance Required in Your State?
Liability car insurance is required by most states in the U.S. To check your state's specific coverage requirements, you'll have to do your research. Failing to maintain adequate liability coverage may result in expensive fines, costly court costs, and the loss of your license. Additionally, failing to maintain insurance for long enough might even necessitate an SR-22 form, in which the state requires you to submit proof of insurance.
Who Should Consider Liability-Only Coverage?
Liability-only car insurance is an attractive option for those who need the cheapest policy to protect them from other people's bodily injury or property damage claims against them. So if you drive a lower-value vehicle, liability coverage might make sense. On the other hand, if you need protection for your own vehicle or bodily injury, you'll need to talk to your insurance company about additional coverages such as personal property damage coverage or personal injury protection.
Compare Liability Car Insurance Quotes with Confidence
There is no suitable one-size-fits-all approach to liability car insurance. Insurance companies calculate your policy premiums using a formula that accounts for your age, driving history, and even your zip code. That's why shopping around is essential to find the best price. Pulling car insurance quotes from multiple companies can be daunting, but you don't have to do it alone. If you're ready to find the best car insurance for you, fill out this easy form and receive a free quote in minutes.