Liability Auto Insurance

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When you purchase a vehicle, whether it’s new or new to you, you’re required to carry liability auto insurance. When you find yourself at fault in an accident, liability insurance covers the expenses of property damage and injury incurred by others involved. Most people bundle liability with collision (which helps to cover your own injury and property damage costs), but there are some instances where liability-only car insurance is a viable option.

What is liability insurance?

Liability car insurance is a safeguard against a driver’s personal assets in the event that they cause an accident that results in bodily harm or property damage to another. Both components — bodily injury and property damage — are third-party benefits, one that the driver cannot use personally. Liability insurance is mandated by law in 49 of 50 states, with varying limits, and protects those who have suffered loss. Both components — bodily injury and property damage — are third-party benefits, one that the driver cannot use personally. Liability insurance is mandated by law in 49 of 50 states, with varying limits, and protects those who have suffered loss.

Who should choose a liability insurance policy?

The short answer is everyone should carry liability car insurance, whether they are a new or established driver. Liability insurance safeguards the individual’s assets should he cause an accident that injures someone or damages their property. Instead of paying out of pocket, the insurance policy covers qualifying property damage and medical expenses related to the incident.

What does liability insurance cover?

There are two main elements to liability auto insurance: bodily injury and property damage. Each type defines what’s covered and has its own limits.

The limits for each component vary by state, and your auto insurance agent can explain the minimum requirements.

Expenses not covered by a liability insurance policy

While liability insurance coverage extends to property damage and medical bills of others injured as a result of an at-fault accident, it does not cover the losses of the person who caused the accident. That’s why there are other types of insurance to consider: collision and medical payments.

Liability auto insurance providers

All insurance companies offer liability car insurance coverage, but at their own discretion. If you have many accidents within a short period of time, you may be deemed high-risk  and denied coverage. Speak to your agent about the costs associated with the policy and shop around for the cheapest liability car insurance quotes.

Choosing the right amount of coverage

Liability insurance coverage and out-of-pocket costs

When it comes to liability car insurance coverage, “less is more” is not a good policy. While each state has a mandated minimum, it’s always a good idea to purchase more coverage. More coverage can protect you and your assets and reduce the amount you have to pay out-of-pocket in the case of an accident.

More liability coverage means less liability

If you’re still on the fence about how much liability auto insurance coverage to purchase, it’s worth considering that the more you purchase, the less liable you are to pay out-of-pocket  . If your liability coverage runs out and the injured party still has treatment ahead of them, you can be legally responsible for paying those fees and could be sued in court, putting your personal assets at risk.

When you purchase liability auto insurance, be sure to speak with your agent and determine what the appropriate amount of coverage should be. Insurance providers often have minimum recommendations that satisfy state and local statute requirements, but you can also opt for more coverage, and this is one case where it’s better to be safe than sorry.

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