liability car insurance
Liability car insurance: What it covers and how much it costs by state.
Find out what liability car insurance does, and what happen if you don’t buy at least the required state minimum amount.
Liability car insurance covers the costs if you are responsible for injuring others or damaging their property in an accident. It’s important because it protects you from financial loss and legal consequences, ensuring that victims are compensated for their losses.
An annual liability policy with the state minimum insurance limit costs $574 per year, while a liability-only policy with limits of 50/100/50 costs $644 per year.
Most state laws require drivers to buy two types of liability car insurances coverage to drive legally: Bodily injury and property damage liability.
What does bodily injury liability car insurance cover?
Bodily injury liability car insurance pay the medical bills of people you are found liable for injuring with your car.
Bodily injury liability (BI) pay up to your policy limits, for injuries or death that you (the policyholder), or other drivers covered by your car insurance policy, are found responsible for the after a motor vehicle accident. Policy terms vary, but typically, bodily injury liability coverage will pay, up to your policy limits, for:
- Medical expenses
- Funeral expenses
- Loss of income
- Pain and suffering
- Legal defense if a lawsuit results from the auto accident
Policy limits for bodily injury liability are per person and per accident, and coverages is written as such. For example, $25,000/$50,000 means the maximum payout per person is $25,000, and the maximum payout for all people injured in one accident is $50,000. This coverage may also be written as 25/50.
Bodily injury liability does not cover your injuries, only the injurie of others that you are liable for. For your personal injuries to be covered, you would need coverages such as personal injury protection (PIP) or medical payments coverage (MedPay).
What does property damage liability cover?
Property damage liability car insurance pays to repair or replace cars or other property you hit with your vehicle.
Property damage liability (PD) pays, up to your policy limits, for damages to someone else’s property that you (the policyholder), or other drivers covered by your car insurance policy, are found responsible for after a motor vehicle accident. Property damage typically is damage to another car, but property damage liability also covers damages you may cause to someone’s house, tree, fence, guardrail, pole, etc.
Property damage liability provides you with a legal defense if another party files a lawsuit against you regarding property damage that resulted from an auto accident. Property damage liability does not cover damages to your own vehicle.
For such coverage, you need collision coverage and comprehensive coverage.
Is liability car insurance mandatory?
Yes, in most states, bodily injury liability and property damage liability are required as part of the minimum auto insurance coverages you must carry as a car owner. Each state has its own state car insurance requirements. You can raise your liability limits, which is strongly encouraged in many cases.
Car insurance companies typically require that you carry the same level of liability coverage on each vehicle listed on your policy. In some states, you must have the same liability limits on all cars you own. Even if the state does not require this, some insurance companies will.
A few states do not require bodily injury liability coverage because they have no-fault laws. Under no-fault rules, drivers must carry personal injury protection to pay for their injuries or those of their passengers. Once those limits are exceeded, you are personally liable for the costs of treating any injuries you cause.
Most people buy bodily injury liability insurance even in states with no-fault laws.
Liability coverage at a glance
Bodily injury liability (up to your limits):
- Pays for damages you cause to others — covers their medical bills and lost wages
Property damage liability (up to your limits):
- Pays to repair or replace the property you destroy or damage — including other cars
- If you are sued after an accident, you can also pay for pain and suffering
Liability does not cover the following:
- Damage to your car from an accident
- Your injuries
- Damage to your car from animal strikes, hail, fire, vandalism or flooding
- Theft
How much does liability car insurance cost?
Liability insurance cost depends on how much coverage you get and other factors, such as your age, where you live, your driving record, and other variables. To give you an idea of how much liability costs for the average driver, here are rates based on a CarInsurance.com rate analysis.
For example, listed below is the average cost of car insurance for three coverage levels, as follows:
- State minimum: This varies by state, and many states have different limits, but a typical amount is $25,000 for medical bills for injuries in an accident you cause, up to $50,000 per accident, with $25,000 for property damage you cause (25/50/25)
- Liability limits of $50,000 for injuries you cause in an accident, up to $100,000 per accident, with $50,000 to pay for property damage (50/100/50)
- Full coverage with comprehensive and collision, which cover damage to your car, carrying a $500 deductible, $100,000 for injuries you cause in an accident, up to $300,000 per accident, with $100,000 for property damage (100/300/100)
| Rate | State Minimum | 50/100/50 | 100/300/100 |
|---|---|---|---|
| Average Rate | $574 | $644 | $1,758 |
| Monthly Average Rate | $48 | $54 | $147 |
States that have the lowest average cost for state minimum liability insurance are shown in the table below.
| State | Lowest average rate for the state minimum |
|---|---|
| South Dakota | $323 |
| Iowa | $326 |
| Wyoming | $328 |
| Maine | $355 |
| Idaho | $377 |
| Virginia | $380 |
| Nebraska | $393 |
| Vermont | $398 |
| Wisconsin | $401 |
| Ohio | $406 |
States that have the highest average cost for state minimum liability insurance are shown in the table below.
| State | Highest average rates for the state minimum |
|---|---|
| Michigan | $1,855 |
| Connecticut | $891 |
| New York | $867 |
| Maryland | $853 |
| New Jersey | $846 |
| Delaware | $843 |
| DC | $839 |
| Florida | $828 |
| Louisiana | $771 |
| Rhode Island | $738 |
Drivers in the following states pay the least for liability limits of 50/100/50.
| State | Lowest average rate for liability with limits of 50/100/50 |
|---|---|
| Iowa | $354 |
| Wyoming | $354 |
| Maine | $359 |
| South Dakota | $362 |
| Idaho | $415 |
| Alaska | $420 |
| Virginia | $424 |
| Nebraska | $426 |
| Ohio | $427 |
| Vermont | $434 |
Drivers in the following states pay the most for liability limits of 50/100/50.
| State | Highest average rate for liability with limits of 50/100/50 |
|---|---|
| Michigan | $1,919 |
| Florida | $1,100 |
| New Jersey | $1,025 |
| Connecticut | $972 |
| New York | $960 |
| Louisiana | $955 |
| DC | $949 |
| Nevada | $945 |
| Delaware | $943 |
| Rhode Island | $921 |
How much liability car insurance do I need?
In many states, the legal minimum is insufficient to pay for serious injuries or replace a late-model car. It is only enough to drive legally. Buy the minimum only if you have no savings or home to shield from lawsuits.
The Insurance Information Institute (III) and other insurance industry experts recommend motorists carry bodily injury liability coverage of $100,000 per person and $300,000 per accident (100/300 coverage). For property damage liability coverage, $100,000 is recommended. If you can afford higher limits, that is even better for protecting your assets. Liability insurance beyond these amounts tends to be very inexpensive.
Recommended limits for liability car insurance
To see what you can expect to pay, here are average car insurance rates by state for the recommended liability limits of 100/300/100. Optional comprehensive and collision are also included in these rates, typically purchased with these liability amounts. Enter your state in the search field to find your rate. The average rate nationwide is $1,758.
| State | Average rate for full coverage |
|---|---|
| Michigan | $3,141 |
| Louisiana | $2,601 |
| Nevada | $2,402 |
| Kentucky | $2,368 |
| DC | $2,188 |
| Florida | $2,162 |
| California | $2,125 |
| New York | $2,062 |
| Rhode Island | $2,040 |
| Connecticut | $2,036 |
Increasing your liability protection is affordable
Liability insurance is the heart of any car insurance policy — it is required to drive legally and pays for damages and medical bills of others when you cause an accident. However, the state minimum is rarely enough to protect your assets and savings if you cause an accident. You are responsible for paying the difference if the repairs and bills exceed your liability limit.
The table below shows what the average driver pays for liability coverage in each state and how much more you pay to boost your coverage.
| State | Average rate state minimum | Average rate 50/100/50 | Difference | Difference |
|---|---|---|---|---|
| South Dakota | $323 | $362 | $39 | 12% |
| Iowa | $326 | $354 | $28 | 9% |
| Wyoming | $328 | $354 | $26 | 8% |
| Maine | $355 | $359 | $4 | 1% |
| Idaho | $377 | $415 | $38 | 10% |
| Virginia | $380 | $424 | $44 | 12% |
| Nebraska | $393 | $426 | $33 | 8% |
| Vermont | $398 | $434 | $36 | 9% |
| Wisconsin | $401 | $450 | $49 | 12% |
| Ohio | $406 | $427 | $21 | 5% |
FAQ: Liability car insurance
What happens if I don’t have liability car insurance?
If you don’t carry liability and the state requires it, penalties such as fines, suspension of your license, and/or vehicle registration can be levied.
Also, without bodily injury liability and property damage liability coverage on your car insurance policy, you will be held personally responsible for any injuries or damages you cause to others in an auto accident. This could mean you will be forced to liquidate property, savings and other assets to pay for a judgment against you.
If you carry bodily injury liability coverage with low limits, you could still be putting yourself at risk financially. If you cause a serious accident where injury expenses exceed your limits, you can be held responsible for the amount above your limits.
The same applies to property damage liability insurance. Every state requires that you take financial responsibility in the event of an accident. If you have low limits on your property damage liability coverage, you are personally liable for the amount over and above what your insurance pays.
Can liability car insurance be used for your car?
No. Your liability coverage can never be used to pay for damages to your vehicle or to recoup its actual cash value (ACV) if your car is totaled in an accident. You can’t make a property damage liability claim against yourself for your property.
Car insurance policies are usually written to provide liability coverage to protect members of your household against claims brought by people who are not part of your household—the other guy.
How does liability insurance work with collision insurance?
Both property damage liability and collision insurance pay for damages to cars from an auto accident but are claimed differently.
Your liability coverages – property damage and bodily injury – protect you when someone files a claim against you for an accident you caused.
Your collision covers your car for damages it receives when it hits or is hit by another vehicle or object, regardless of fault.
So, you can file a claim against your collision coverage for any damages your car sustains. Still, the other driver in an accident you caused would file a claim against you that your liability insurance would cover.
Collision also differs from property damage coverage because it comes with a deductible. A deductible is an amount you must pay out of pocket before your insurance benefits kick in.
Your car insurance company will pay for the other party’s repairs through your liability coverage without a deductible being due.
What is the average property damage liability claim amount?
Among property damage liability claims, the average amount paid in 2018 was $3,593, up 3.2% annualized from $2,792 in 2010. The median payment in 2018 was $2,165, according to a November 2020 report, the latest data, from the Insurance Research Council (IRC).
Rhode Island had the highest average property damage liability payment, with an average of $3,669 across the three claim years studied: 2010, 2014 and 2018. Rhode Island was also the state with the most significant increase. The annualized percent change in average payment in the state from 2010 through 2018 was 6.3%.
Other states with relatively high average PD liability payments included Arkansas ($3,618), Alaska ($3,581), and Louisiana ($3,546). Among the states with low average payments were the District of Columbia ($2,371), Vermont ($2,518), and New Hampshire ($2,698).
Resources & Methodology
Methodology
CarInsurance.com commissioned Quadrant Information Services to report average auto insurance rates for a 2016 Honda Accord for nearly every ZIP code in the United States. We calculated rates using data for up to six large carriers (Allstate, Farmers, GEICO, Nationwide, Progressive and State Farm). Averages are based on insurance for single 40-year-old driver, with policy limits of 100/300/100 ($100,000 for injury liability for one person, $300,000 for all injuries and $100,000 for property damage in an accident) and a $500 deductible on collision and comprehensive coverage. This hypothetical driver has a clean record and good credit. The rate includes uninsured motorist coverage. Average rates are for comparative purposes. Your own rate will depend on your personal factors and vehicle.
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