What Is Liability Car Insurance Exactly?

Liability car insurance, like a driver's license, is a basic requirement for being a motorist. If you're going to drive, you'll need it.

If you are not afraid of taking risks, have few assets, and can afford to pay tens of thousands of dollars to cover your own injuries and damages, a liability policy may be all you need. However, for drivers seeking more than the bare minimum of coverage, liability insurance serves as the foundation for a more comprehensive auto policy that includes multiple types of coverage.

Liability Car Insurance Coverage Defined

By definition, liability car insurance covers only the injuries or damage you cause to other people and property. Because liability-only coverage does not cover your own injuries or property, you must supplement it with additional insurance to protect yourself.

The same rules apply to rental car liability insurance; the other people involved in the accident are covered, but you are not.

Liability-only car insurance is the most basic coverage available, but it is also the most important. Most states require liability car insurance coverage, and each state establishes a minimum amount of coverage that must be purchased.

This is how it works:

If your insurer determines that you were at fault in an accident, your insurer will pay the costs of damages for the other party's damaged car, less your deductible and up to your coverage limit. So, if the damages are $10,000 and your deductible is $1,000, your insurance would cover $9,000 of the cost.

If you want the best liability car insurance, look for a policy with a higher coverage limit than your state requires. Some states require as little as $15,000 in coverage per person injured or $30,000 in coverage per accident.

When requesting a liability car insurance quote, consider how much of a deductible and monthly cost you can afford, and then balance those rates with how much financial protection you believe is adequate.

Remember that the quickest way to get a liability car insurance estimate is to use our online auto quotes on your computer or phone.

How to Get the Best Deal on Liability Car Insurance

The cost of liability car insurance is determined by a number of factors. If you want affordable coverage, consider the following:

Shop around for quotes from various insurance companies.
Because average liability car insurance costs vary by state and zip code, where you live has an impact on your rates.
Your driving record also influences how much liability insurance you need for your car.
If you are determined to find a low-cost policy, liability-only car insurance will be your most affordable option.
If you're looking for low-cost coverage in your area, comparing quotes online might be your best bet.
Raising your deductible can help you save money on your insurance.
Another strategy is to apply for auto insurance discounts, of which there are several available, such as good students, bundled policies, low annual mileage, and anti theft devices.

What Does Liability Car Insurance Cover?

Liability insurance's purpose is to provide the most basic protection if you are at fault in an accident. However, it is critical to understand that this basic protection only applies to the other people involved, not to yourself.

To begin with, liability insurance does not cover:

If you are hit by a car, you will be responsible for the damage to your vehicle. To pay for repairs, you'd need a collision policy. If the other driver has a liability policy, their insurance will cover your expenses.
If your vehicle has been totaled and you only have liability insurance. Even if your car is totaled, your own liability policy will not cover you, no matter how extensive the damage is. If the other driver was at fault, you would have to rely on collision coverage or the other driver's liability insurance.
Automobiles for rent If you cause an accident while driving a rental car, your liability coverage will not cover any damage to the rental car.
Windshield replacement. If a rock or other object hits your windshield, you'll need comprehensive coverage to replace it.
Car theft. If your car is stolen, only comprehensive coverage will pay for it.
Hit and run. If you are the victim of a hit-and-run, you will need collision or uninsured motorist coverage to cover your damages, as well as your own health insurance to cover your injuries.
In the event of an at-fault accident, you will be responsible for your own medical bills.
Hail damage, as well as damage caused by other natural disasters such as hurricanes, flooding, earthquakes, or wildfires In these cases, a comprehensive policy would protect you.
Vandalism. If your car is vandalized, comprehensive coverage, not liability coverage, will pay for the damages.

Now, let's look at what liability insurance does cover:

If you cause an accident, you are responsible for another person's medical bills and damages.
You were at fault in a hit-and-run accident. If you flee the scene of an accident that you caused, but later turn yourself in or the victim finds you, your liability insurance will cover the person you hit. However, you may face criminal charges as well as significantly higher insurance rates.
Injuries and property damage caused by you while driving a rented car. Even if liability coverage does not cover your own expenses, it will cover the costs of other people's injuries and damages in the event that you cause a car accident. You can purchase supplemental liability insurance from the car rental agency if you need more liability coverage than your policy provides.
When you are covered by the other person's liability insurance. If the other driver was at fault and had liability insurance, it would cover your injuries or repairs.

Even if you have liability insurance, it only covers you up to a certain amount, depending on how much coverage you have purchased. Take this into account when determining how much liability car insurance you require.

Liability Car Insurance vs. Other Car Insurance Types

Additional types of auto insurance can be purchased to supplement your liability coverage and provide protection for your own injuries and damages.

Liability insurance is not the same as collision or comprehensive insurance. And no matter how much liability coverage you have, it will not protect you or your vehicle in the same way that collision and comprehensive insurance will.

Collision insurance protects your own vehicle in the event of an accident, regardless of who is at fault. In the event of a collision, liability would not cover the cost of repairing your vehicle. Collision coverage is only applicable if you have been in an accident with another vehicle.
Comprehensive coverage protects your car from damage caused by events other than a collision. A comprehensive policy would protect you if a tree fell on your car or if your car was stolen. In contrast to a comprehensive policy, liability coverage does not cover any type of damage to your car, whether it occurred in a collision or was caused by another event.
Personal injury protection (PIP) pays for your injuries and allows you to collect lost wages if you were in an accident, regardless of fault.

When deciding between liability and full coverage car insurance, keep in mind that the term "full coverage" can refer to a variety of things and is not a specific type of policy. Full coverage simply means that your policy extends beyond liability and includes multiple types of coverage.

A full coverage policy is typically a combination of comprehensive, collision, and liability policies, but it may also include personal injury protection and uninsured motorist coverage.

If you're trying to figure out how much liability car insurance you should get, your insurer will distinguish between bodily liability and property liability coverage.

You can increase or decrease the amount of coverage you want in each of these categories as long as you buy the bare minimum required by your state.

Understanding Limits on Liability Car Insurance

There are limits to the coverage provided by liability insurance. For example, if you purchase a 25/50/25 liability policy, your insurance will cover up to $25,000 in bodily injury liability for one person, $50,000 in bodily injury liability for all persons involved in a car wreck you caused, and a maximum of $25,000 in property damage liability.

Any costs in excess of those amounts would have to be borne by you. So, when purchasing your policy, be sure to carefully consider your car insurance liability limits!