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You’ll usually see your liability coverage broken into three separate numbers that indicate your liability limits for bodily injury and property damage (the minimum limits required vary by state). For example, the minimum limits for auto liability in Illinois are $25,000/$50,000/$20,000. Here’s what those numbers mean:
- Bodily injury per person: $25,000 is the maximum amount your insurance company will pay out for injuries per person.
- Bodily injury per accident: $50,000 is the maximum amount your insurer will pay out for injuries per accident.
- Property damage per accident: $20,000 is the maximum amount your insurer will pay out for damage to someone else’s vehicle or property per accident.
Consider the two scenarios below, assuming your liability limits are $25,000 per person, $50,000 per accident, and $20,000 for property damage.
If you’re at fault in an accident, your liability limits pay for damages and injuries you cause to others, including:
- Damage to other cars
- Damage to property (mailbox, house, street sign, guardrail, etc.)
- Injuries to other drivers/passengers/pedestrians
- Lawsuits and attorney/court fees
Do I need auto liability insurance?
Yes, auto liability coverage is required in nearly every state. However, the amount of coverage you’re required to have varies widely between states.
How much auto liability insurance do I need?
If you’re liable in an accident, a court judgment could cost you your life savings, so you’ll want to make sure you’re well-covered. Add up your assets, including bank, brokerage, and retirement accounts, as well as equity in your home and other property. Then, subtract your debts to get your total net worth. Consider choosing at least that amount for bodily injury liability, as your total net worth can grow. Keep in mind, bodily injury typically results in more expensive claims than property damage.
Note that the cost of bodily injury liability will vary by coverage amount and per driver, and the difference between the state minimum price and $100,000 is often minimal. Get more tips on figuring out how much car insurance you need. Our car insurance estimator can also give you an idea of what coverage level is right for you.
If you have a high net worth, it might be worth taking out an auto policy with a CSL for both bodily injury and property damage. CSL amounts usually range between $300,000 and $500,000. Premiums for a CSL policy are higher, but your coverage limit can be divided in whichever way necessary to satisfy a claim against you.
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Please note: The above is meant as general information to help you understand the different aspects of insurance. This information is not an insurance policy, does not refer to any specific insurance policy, and does not modify any provisions, limitations, or exclusions expressly stated in any insurance policy. Descriptions of all coverages and other features on this page are necessarily brief; in order to fully understand the coverages and other features of a specific insurance policy, we encourage you to read the applicable policy and/or speak to an insurance representative. Coverages and other features vary between insurers, vary by state, and are not available in all states. Whether an accident or other loss is covered is subject to the terms and conditions of the actual insurance policy or policies involved in the claim. References to average or typical premiums, amounts of losses, deductibles, costs of coverages/repair, etc., are illustrative and may not apply to your situation. We are not responsible for the content of any third-party sites linked from this page.
Liability coverage is an important insurance protection. Bodily injury and property damage liability coverages provide compensation for injuries to others, and for the damage your vehicle does to another person’s property if you cause an accident.
What Does Liability Car Insurance Cover?
If you are found responsible for causing damages as a result of an accident, this coverage may pay up to the limit you select, and it can provide for a legal defense if you’re sued.
Liability coverage pays for both property damage you caused to another’s property, as well as any bodily injury caused to others as a result of the accident. The following expenses are among the types of damages that may be considered:
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Hospital and medical bills
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Lost wages
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Pain and suffering
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Rehabilitation services
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In-home healthcare services
Liability coverage provides important protection for drivers and most states require drivers carry a minimum amount of liability insurance. Most states require drivers to carry auto liability insurance.
To learn more about auto liability insurance coverage types, contact your local independent agent or Travelers representative and ask about the auto liability insurance that’s right for you.
View Video Transcript
[Music]
>>SPEAKER: Bodily injury liability coverage - you might have heard of it but what is it?
Picture this, you're driving to work, on the way you get into an accident with another car carrying three people. Unfortunately, all of them are injured. That's what bodily injury liability coverage is for.
If any of the injured people sue you, your coverage provides for a couple of key things.
One - your legal defense. And two if you're found responsible for damages up to the policy limit. here's another important thing to keep in mind. If you're found liable for an accident, your net worth could be at risk. The more assets you have, more coverage you may want.
For additional liability protection, look into getting an umbrella policy.
For more answers, go to Travelers.com.
[sonification]
Bodily injury liability insurance typically covers the costs associated with injuries you caused to other people, up to your policy limit, in a covered accident. Coverage can also pay for a legal defense if you’re sued for that accident.
View Video Transcript
[Music]
>>SPEAKER: Property damage liability coverage - you might have heard of it but what is it?
Picture this, you're driving to the store, on the way you accidentally rear-end a stopped car at an intersection. Nobody is injured but the other car is damaged. That's what property damage liability coverage is for - your coverage provides for a couple of key things:
One, damages to the other person's car, if you're responsible for the accident up to your policy limit and two, to your legal defense.
If the owner of the other vehicle sues you, here's another important thing to keep in mind if you're found liable for an accident. Your net worth could be at risk. The more assets you have, the more coverage you may want.
For additional liability protection, consider an umbrella policy.
For more answers, go to travelers.com
[sonification]
Property damage liability coverage is insurance that pays for the damage you cause to other’s property, including vehicles, in a covered accident.
Your local independent agent or Travelers representative can help you understand your state requirements and select the amount of liability coverage that’s right for you. Contact your Travelers representative to get a car insurance quote.
When you bundle your car and home policies with Travelers you could save up to 10% on your car insurance. There may be additional savings when you purchase other policies like boat, umbrella insurance and a personal articles floater.
Liability car insurance, also known as liability coverage, helps pay for the costs of the other driver’s property and bodily injuries if you are “at fault” in an accident. Your insurer will pay for the property damage and injuries up to the covered limit.
Liability car insurance falls into two categories. Each covers different items.
Pays for costs associated to injuries for which you are legally liable. This means that your actions caused injury to another person and you were found legally responsible for those injuries.
What type of bills does BI coverage pay?
- Medical expenses
- Pain and suffering
- Lost wages
Pays for damage done to another person’s or company’s property, as well as for the loss of use of that property. This means that your actions caused damage to property (a car, a house, a tree, etc.) and you were found legally responsible for those damages.
What type of bills does PD coverage pay?
- Vehicle repair
- Repair to the living room wall you crashed through
- Removal of the knocked over tree
- Defense and court costs if you are sued
There’s another type of liability coverage that can protect your assets (and your financial future) in the event you’re in an accident: a personal liability umbrella policy.
Umbrella policies provide coverage above and beyond what your car liability insurance covers, especially if you’re the target of a lawsuit after an accident involving your car, home or boat.
Learn more about umbrella policies offered by State Farm by contacting an agent.
The minimum amount of liability coverage you’re legally required to carry varies by state, and the amount your premium may rise if you purchase additional liability insurance also will vary by state.
The premiums increase usually is smaller than you’d expect. And keep this in mind: your monthly premium with additional liability coverage is almost certain to cost you less than what you’d pay if you’re in an accident and not properly covered.
If you decide not to purchase additional liability coverage, you should ask yourself this: “How much can I afford to pay out of my own pocket if I'm responsible for an accident?"
Minor "fender-benders" are often fully covered by the liability coverage minimums set by your state. But it only takes one accident to disrupt life as you know it.
Why not further protect your family and assets by choosing higher liability coverage, at rates you can afford?
Disclaimer
This document contains only a general description of coverages and is not a statement of contract. All coverages are subject to all policy provisions and applicable endorsements, and may vary by state. For further information, please see a State Farm agent.
State Farm Mutual Automobile Insurance Company State Farm Indemnity Company
Bloomington, IL
State Farm County Mutual Insurance Company of Texas
Richardson, TX