IN PLAIN ENGLISH

Liability car insurance definition & basics

Liability insurance coverage protects other drivers from bodily injury or property damage you might cause in an at-fault accident. We'll review liability insurance thoroughly in the following guide, answering the following questions:

  • What does liability insurance cover?
  • How much liabiliity auto insurance should you have?
  • How much does liability car coverage cost?

Liability coverage is defined by two key coverages: bodily injury and property damage protection. The amount of liability coverage you carry depends on personal preference and laws in your state. Because car insurance is regulated at the state level, each state sets minimum policy limits for liability coverage.

Basic liability car insurance options look like this:

 

50 /100 / 50
$50,000 in bodily injury coverage per person$100,000 in bodily injury coverage per incident$50,000 in property damage per incident

 


What doesn't liability insurance cover?

While liability insurance is mandatory in most states, it’s not the only coverage you should carry.

Some things aren't covered by liability insurance:

  • Collision Coverage: If you drive a valuable vehicle, i.e., worth more than $4,000, consider adding this coverage to protect your vehicle from damage by striking a fixed object (such as a wall or another vehicle)
  • Comprehensive Coverage: Usually paired with collision coverage, comprehensive coverage protects your vehicle from incidents not covered by collision coverage. This includes theft, vandalism, or animal damage.
  • Uninsured/Underinsured Motorist Coverage: This coverage protects you and your vehicle from damage done by a driver without insurance — or someone with insufficient insurance. Like liability coverage, it is broken down into property damage and bodily coverage options. This coverage can also apply if you're injurid by a hit-and-run driver.
  • Personal Injury Protection (PIP): This add-on provides assistance for medical expenses and work loss coverage after an accident, independent of fault. If you don’t have health insurance, PIP is worth considering. This insurance policy is commonly coupled with no-fault insurance.

 

How much liability insurance do you need?

Each state has its own mandatory liabiility insurance minimums. While we’ve listed mandatory minimum liability insurance by state at the end of this section, it's often a good idea to carry more than the minimum. Although you might save a few bucks by dropping coverage, it's not recommended to maintain minimal liability car insurance coverage because:

  • You are responsible for any remaining damage not covered by your insurance
  • You appear as high-risk to insurance companies

You’re responsible for any damages not covered by your liability coverage:

Because some states have very low liability limits, you end up responsible for any damage not covered by your insurance. Let's say you’re a California resident who totals another driver's 2018 Ford F150 — listed at $27,705 — in an at-fault accident. In California, mandatory minimum liability car insurance covers $5,000. You would be responsible for the remaining $22,705. Depending on your financial situation, this could be a tricky hole to climb out of.


You appear as a risk to insurance companies:

Carrying your state’s minimum liability coverage not only leaves you on the hook for any damages left over from a claim, but also stands out as a red flag for insurers. If you elect to carry high liability limits, you shoulder some of the insurance company's financial responsibility and risk. If you carry the bare minimum liability car insurance, you pass more risk along to the insurer — leading to more expensive premiums, in many cases. 

  

6mo with State Min Bi Limits6mo with 50/100 Bi Limits6mo with 100/300 Bi Limits
$1,568$1,495$1,465

 

To avoid higher rates, consider keeping your liability coverage at 100/300/100, if possible.


How much does liability car insurance cost?

The price of liability insurance depends on several factors. Based on the US average with a standard vehicle and driving profile, the cost difference between minimum liability limit coverage and "full coverage" is approximately $180 per year. 

 

State Minimum50/100 Limits100/300 Limits
$581$672$761


While your liability coverage makes up half of your premium if you also carry collision and comprehensive coverage, there’s less of a difference between the amount of liability limits. 

 

 State-by-State Breakdown by Minimum Liability Limits

 


State

 Bodily Injury: Per Person  Bodily Injury: Per Accident  Property Damage 
Alabama25k50k25k
Alaska50k100k25k
Arizona15k30k10k
Arkansas25k50k25k
California15k30k5k
Colorado25k50k15k
Connecticut20k40k10k
Delaware15k30k10k
Florida10k
Georgia25k50k25k
Hawaii20k40k10k
Idaho25k50k15k
Illinois25k50k20k
Indiana25k50k10k
Iowa20k40k15k
Kansas25k50k25k
Kentucky25k50k25k
Louisiana15k30k25k
Maine50k100k25k
Maryland30k60k15k
Massachusetts20k40k5k
Michigan20k40k10k
Minnesota30k60k10k
Mississippi25k50k25k
Missouri25k50k10k
Montana25k50k10k
Nebraska25k50k25k
Nevada15k30k10k
 New Hampshire 25k50k25k
New Jersey15k30k5k
New Mexico25k50k10k
New York25k50k10k
North Carolina30k60k25k
North Dakota25k50k25k
Ohio25k50k25k
Oklahoma25k50k25k
Oregon25k50k20k
Pennsylvania15k30k5k
Rhode Island25k50k25k
South Carolina25k50k25k
South Dakota25k50k25k
Tennessee25k50k15k
Texas30k60k25k
Utah25k65k15k
Vermont25k50k10k
Virginia25k50k20k
Washington25k50k10k
Washington DC25k50k10k
West Virginia20k40k10k
Wisconsin25k50k10k
Wyoming25k50k20k

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