What Is Liability Car Coverage?
You are required to have car insurance if you drive a car in the U.S. The liability coverage in the policy covers the expenses for the other person's bodily injuries, vehicle and property damage up to the limits stated in the policy. It is the minimum insurance required for you to operate your vehicle. Your state-licensed insurance agent or broker can tell you about your options and the legal requirements for your state.
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Collision
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A collision results when your car makes physical contact with another car, causing damage. The liability coverage limit is applied to the repair or replacement of the other person's damaged car; it does not cover your vehicle damage. If the policy amount does not cover all the damage, you are responsible for the remaining costs.
Property Damage
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The amount specified by the policy goes toward the repair or replacement of the damaged property. Some items that are commonly involved in collisions are fences, mailboxes and fire hydrants. Damage to structures, such stores, office buildings and parking garages, also are protected. If the policy limit does not cover the damages, you may be responsible for any remaining costs for the repair or replacement of the property.
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Bodily Injury
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The policy limit covers any bodily injuries sustained by the other driver and his passengers. Medical expenses include the initial treatment of injuries and any care follow-up care related to the injuries. This includes doctor visits, physical therapy and outpatient services.
Other Covered Expenses
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The bodily injury section of the policy also can cover legal defense fees or funds for bail for anyone listed on your policy, the other driver's loss of income because of medical reasons or legal obligations relating to the accident or funeral expenses.
Policy Limits
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You can purchase a policy with split limits or with a single limit. Split-limit coverage specifies separate amounts of coverage for bodily injury and property damages, while single-limit coverage is for both bodily injury and property damage. For example, if you have a split policy limit of $15,000 for bodily injury and the other driver's medical expenses total $20,000, you are responsible for the remaining $5,000. But if your policy has a single limit of $30,000 and the property damage is less than $10,000, all costs will be covered.
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