How to Determine Car Insurance Liability Limits

By eHow Cars Editor

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Auto insurance, bodily injury and property damage liability coverages protect you if you injure someone or damage or destroy someone's property.

Instructions

Difficulty: Moderate

Things You’ll Need:

Step1
Learn the minimum liability limits required by your state.
Step2
Determine your assets. Insurance is meant to protect what can be lost in a lawsuit.
Step3
Think about the ages of the drivers in your household. Youthful drivers have more accidents resulting in lawsuits.
Step4
Realize you share liability for your children until they reach a specific age.
Step5
Consider your profession. If you work in the public eye or if you work in a profession perceived to have high income, you're likely to face larger lawsuits.
Step6
Understand that numerous cars on the road are worth more than the $25,000 property damage limits afforded by a basic policy.
Step7
Realize that you may be liable for damage to more than one vehicle if you cause a chain reaction accident.

Tips & Warnings

  • Car leasing companies may require specific liability limits.
  • If you use your car on the job, your employer may demand high limits.
  • "25/50/25" means your insurance company will pay up to $25,000 if one person is injured or killed, $50,000 if more than one person makes a claim and up to $25,000 in property damage.
  • Consider a personal liability umbrella policy instead of boosting your car insurance to the maximum limits if you have significant assets.

Comments

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Anonymous

Anonymous said

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on 11/22/2005 A great source whereby you can determine your state's minimum liability coverage is the Insurance Information Institute (iii.org) . Another source is Best-insurance-deals.net, which has an interactive map which lists limits, no-fault laws and other requirements for car insurance in your state.

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eHow Article: How to Determine Car Insurance Liability Limits

eHow Cars Editor

eHow Cars Editor

Category: Cars

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