Liability Car Insurance Coverage
It is important that you carry liability car insurance on whatever car you happen to be driving. Even if it is not your own car, you may be held responsible for driving without insurance if you are found to be driving any car that does not have a valid liability insurance policy. Liability-only coverage is often referred to as third-party car insurance. Minimum state required third-party coverage is the cheapest car insurance coverage you can get. However, if you can afford it, we strongly recommend getting more coverage than states require.
How Much Coverage Do You Need?
Each state will have different levels of insurance that you must carry to be considered insured. Some states may require you to have as little as $10,000 of coverage while other states may require $25,000 or more of coverage. You can find out how much coverage your state requires by asking an insurance agent. If you purchase a policy online, the amount of liability coverage you will purchase should already be set to reflect the minimum legal limit.
What Will Liability Car Insurance Cover?
Liability coverage will help you pay for any damage to any car or person that is involved in an accident. If you damage another driver’s car or send another driver to the hospital, your insurance policy will cover the amount of the damage. Keep in mind that if you are not responsible for the accident, you will not have to pay for the damage to either your car or to any other car involved in the accident. The only exception to this rule is if you live in a no fault state. In this circumstance, your own insurance company will pay for whatever damage occurs regardless of who is at fault.
What Happens If The Amount Of Damage Is More Than My Policy Covers?
Your insurance company will limit their coverage to the dollar amount of coverage that you purchase. For example, if you purchase $20,000 of liability coverage, you will be covered for up to $20,000 of damage. If the total damage amount is $25,000, you will have to pay the extra $5,000 on your own. Therefore, it is important to purchase an adequate amount of liability coverage instead of just the state mandated level of coverage.
Carrying an adequate level of liability insurance is paramount if you wish to remain financially secure after an accident. It is much better to pay a little bit more each month for insurance as opposed to having to pay out thousands of dollars in the event that you get into a bad car crash.
Learn more about other types of car insurance coverage and also be sure to compare car insurance quotes using our comparison tool before settling for a premium.