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Liability car insurance coverage

Most states require drivers to buy this coverage before hitting the road.

Updated

When drivers talk about auto insurance, they’re usually referring to liability coverage. This is the insurance that covers you if you’re at fault in an accident and you need to pay for the resulting costs.

What does at fault mean? Being at fault means you caused an accident. In most states, being at fault also means your insurer will pay for car repairs, medical bills and other costs that result from the incident.

What is liability coverage?

While you’re driving, there’s always a risk that you’ll be at fault for an accident. Maybe you’ll hit another car, injure another person or damage someone’s property. Of course, you’ll need to pay for the resulting costs — whether those include car repairs, medical expenses or replacing damaged property.

Those costs can increase rapidly. To avoid paying out of your own pocket, you buy liability coverage to protect yourself. Liability coverage will pay for most or all of the costs should you be on the hook for any damages.

Types of liability coverage

There are two types of liability coverage: bodily injury liability and property damage liability.

  • Bodily injury liability pays for costs if you injure another person in a car accident. It covers medical bills and lost wages caused by the accident.
  • Property damage liability pays for costs if you damage another person’s property in a car accident. That includes damage to cars, trees, fences or other objects.

On an online quote or your policy, liability coverage limits might look something like: 50/100/50. This means $50,000 bodily injury liability per person, $100,000 bodily injury liability per incident and $50,000 property damage liability per incident.

Cheapest liability-only insurance

Company Average annual rate Learn more
Geico $394 Read review
USAA $416 Read review
Alliance $435
Progressive $536 Read review
Grange $557 Read review
Mercury $564 Read review
Esurance $609 Read review
Kemper $615 Read review
21st Century $651 Read review
Allied $666 Read review
Nationwide $666 Read review
Allstate $693 Read review
Liberty Mutual $709 Read review
State Farm $726 Read review
The Hartford $727 Read review
Average $598 Compare all reviews

How liability coverage works

When you’re buying car insurance, you’ll need to choose the amount of liability coverage you want. Your policy will either be split limit or combined single limit.

Split limit policy

While shopping for liability coverage, you may see an insurance policy expressed as 25/50/15 — or similar to the above example. When you see numbers expressed in this way, you’re looking at a split limit policy.

These numbers are just shorthand for how much your insurance will cover you for:

  • The first number is the individual payment limit per accident for bodily injury. The 25 in our example refers to $25,000. It’s how much your insurance will cover for each person’s bodily injury costs — other than yours. For example, if you injure one person in an accident and their medical bills are $20,000, you’re covered.
  • The second number is the overall payment limit per accident for bodily injury. The 50 refers to $50,000. It’s how much your insurance will cover for the total bodily injury costs in an accident — again, other than yours. For example, if you injure 5 people and their medical bills are $20,000 each, you’re on the hook for $100,000. In this case, your policy will cover $50,000, and you’ll need to pay the other $50,000 yourself.
  • The third number is the overall payment limit per accident for property damage. The 15 refers to $15,000. It’s how much your insurance will cover for the total cost of property damage in an accident. This doesn’t include your own vehicle — instead, you’ll need collision coverage for that. For example, if you ram into a barn and it costs $6,000 to repair it, your insurance will cover the expenses if you have a 25/50/15 split limit policy.

The three numbers change to create different policies. Your state most likely has policy minimums, but otherwise you’re free to choose the right mix for your own needs.

Combined single limit policy

A combined single limit policy offers one coverage limit.

Let’s say you take out $200,000 of combined single limit coverage. In the event of an accident, you can split this coverage between different types of damages.

For example, you’d be covered in the following instances:

  • One person’s medical bills totals $150,000, and there’s $30,000 in property damage.
  • The medical bills of four people totals $200,000.
  • Property damage that costs $180,000. You also need to pay for someone’s medical bill of $5,000.

All of the costs are $200,000 or less, so your combined single limit insurance will cover them.

Does liability insurance come with a deductible?

Liability coverage usually doesn’t come with a deductible. For example, if you hit someone else’s car and your insurance covers the cost of repairs, you won’t have to pay out of your pocket.

Best cheap liability policy: Progressive

Discover coverage that’s broader than competitors, valuable discounts up to 30% off and perks like shrinking deductibles that reward no claims.

  • Broad coverage, including for custom car parts or ridesharing
  • Transparent pricing tools that help you buy within budget
  • Accident forgiveness on small claims or for staying claim-free
  • Stack a variety of discounts for multiple cars, autopay or homeownership

Compare liability car insurance policies

Name Product Roadside assistance New car protection Accident forgiveness Safe driver discount Available states
Progressive
Optional
30%
All 50 states
Discover coverage that’s broader than competitors, valuable discounts up to 30% off and perks like shrinking deductibles that reward no claims.
USAA
Optional
Yes
All 50 states
Affordable car insurance with highly rated customer service. Only available to military members and veterans and their family.
Allstate
13%
All 50 states
Your dedicated agent can help you find the best savings with multiple discounts and rewards programs.
The AARP Auto Insurance Program from The Hartford
Optional
Yes
All 50 states & DC
Drivers over age 50 can enjoy low rates and perks designed for mature drivers, plus freebies and AARP member perks like free replacement cost coverage.
Liberty Mutual
Optional
30%
All 50 states
Earn free accident forgiveness after five years claims-free and customize your policy anytime online at the tap of a button.
Esurance
40%
All states except AK, DE, HI, MT, NH, VT, WY
Take advantage of this online company's low base rates and mobile tools like app-based telematics and teen safe driver programs.
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How much liability coverage do I need?

Though you’ll be ready to drive if you meet your state minimum required coverage, you may want to buy a higher amount of protection. Medical bills and repair costs can stack up quickly, especially if there are multiple cars involved.

If you select the bare minimum liability limits, you’ll be left to pay the excess damage expenses out of pocket. Also, you could appear high-risk to insurance companies, since you’re passing on more responsibility. As a general rule, many experts recommend buying policies that at least cover the value of your assets.

What are the requirements for New Hampshire and Virginia?

If you live in New Hampshire, you’re not required to have auto insurance. However, you need to prove you can pay up if you cause bodily injury or property damage. The easiest way to do this, of course, is by purchasing insurance.

It’s not mandatory to have auto insurance in Virginia, either. But like in New Hampshire, you must prove you can pay for costs stemming from bodily injury or property damage. You can do that by either buying insurance or paying a fee to Virginia’s motor vehicles department.

How much does liability coverage cost?

The overall cost of liability coverage will vary considerably depending on your age, where you live and your driving history, among other factors. As a ballpark, expect it to cost between $1,000 and $2,000 a year.

However, if you’re just looking for the state minimum required coverage, you could spend far less. While this option isn’t right for everyone, compare sample quotes to see if it could be a good fit for your budget.

What’s not covered by liability insurance?

While this coverage is required, you might need other coverages to be fully protected. Here are some things not included in liability insurance:

  • Damage to your car caused by a collision or otherwise. If you have a long commute or drive a newer vehicle, you might want collision and comprehensive coverage to protect you from pricier repair costs.
  • Medical bills. Personal injury protection can help with medical expenses or finances after a car crash.
  • Uninsured drivers. Underinsured coverage will protect you if someone can’t pay for your damages in a crash they caused.

Bottom line

In all states but Virginia and New Hampshire, liability coverage is required for every driver. Your state will likely have coverage minimums, but consider purchasing higher coverage limits to protect your assets.

Find the best deal on liability coverage by comparing car insurance companies.

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Frequently asked questions about liability coverage

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