What You Don’t Know About Liability Insurance Can Hurt You Financially!
Liability coverage doesn’t cover expenses related to damage to YOUR property or YOUR injuries.
But it does, however, cover those things suffered by other parties in an accident which you are found to be at fault (and let’s face it, it’s not a perfect world and mistakes do happen).
This Is What You Need to Know When Choosing Coverage Levels for Liability.
- There are two types of liability coverage on your car insurance—Bodily Injury (BI) and Property Damage (PD)
- When you’re at fault it will cover people in the other car, pedestrians, etc., or damage to owned property such as fences, garage doors, light poles, etc.
- A liability coverage limit is the maximum amount your insurer will pay, per accident, for a covered claim.
- Anything above the limit is your responsibility. You choose your limits for BI and PD when you buy your policy.
- BI and PD limits can be listed on your policy as three separate dollar amounts such as “100/300/100” (which would translate to $100,000 maximum per person for BI, $300,000 maximum total per accident for BI, and $100,000 maximum for PD).
- Your BI and PD limits could also be listed as a “combined single limit” instead of three separate dollar amounts. This represents a single maximum payout amount that applies to all injuries and property damage combined in a covered accident.
- When purchasing your liability coverage, you’re only obligated to meet your state’s minimum limit requirements, which vary depending on the state. But keep in mind, the minimum limits may not provide the level of protection you are comfortable with.
- The amount of coverage selected will determine the premium you pay for it, however the slight cost increase for higher car insurance limits can be well worth the peace of mind they provide.
Insurance is Meant to Cover Those Rare But Sometimes Severe Loss Situations.
Call us today to review your liability coverage and make sure you have the coverage you need.