This is the single most important type of auto insurance coverage. Carrying too little auto accident liability can expose you to judgments and legal costs for years to come. Most states require something like 50/100/25 in liability coverage. That's up to $50,000 coverage for any single person injured by you in an auto accident, and up to $100,000 for everyone injured. Not a lot of money for medical bills, lost wages, and compensation for pain and suffering. You should probably carry more.
Additional auto insurance coverage (anything you get over the minimum) gets cheaper as you buy more. This means that your premium goes up a little while your protection goes up a lot.
Pay special attention to bodily injury liability. It's easy to imagine the cost of personal injuries (plus pain and suffering and lost wages) totalling a million dollars from a somewhat serious accident.
The standard (the average, not the minimum) auto liability policy is 100/300, where the 300 stands for $300,000 in total bodily injury liability.
But we would recommend that you take out at least $300,000-$500,000 worth of personal injury liability, even if that means less property damage coverage.
Why? Because property damage from an accident won't be nearly as expensive as injuries can be. So the $25,000 worth of property damage liability coverage in our example policy is probably adequate. (Of course, you can be on the safe side with a little more).
Basic Liability Coverage
This is probably the most important type of car insurance, and it's required by most state auto insurance laws. Liability car insurance protects you against the cost of damage and injury that you cause to another in an automobile accident.
It's actually made up of two different policies, bodily injury liability, and property damage liability. As you might guess, bodily injury insurance protects you from the cost of personal injury to others, and property damage insurance protects you from the cost of damage you cause to any physical property.
You've probably seen automobile policies described by three numbers (like 50/100/25). These numbers refer to auto liability insurance.
They're usually called the split limits of liability insurance. Under our example auto liability insurance policy, you'd be covered for up to:
$50,000 worth of bodily injury caused to another person $100,000 for bodily injuries caused to everyone $25,000 worth of property damage Your state's car insurance laws will require a certain level auto liability insurance. You can find your state's auto insurance requirements here.
Even though it may be tempting to save a few bucks by going with the minimum liability required in your state, it is always worth investing in a little extra protection.
by InsuranceTips
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