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Liability coverage is one of the basic types of car insurance that’s required in nearly every state. Liability property damage coverage protects you from damage you cause in a car accident, otherwise known as costs you’re liable for.
Drivers typically buy liability coverage, which includes property damage liability insurance and bodily injury liability insurance. A liability-only policy is the cheapest type of car insurance you can buy. As a ballpark, expect it to cost between $500 and $1,000 a year.
The overall cost of liability coverage will vary considerably depending on your age, where you live and your driving history, among other factors.
Liability coverage usually doesn’t come with a deductible. For example, if you hit someone’s fence and your insurance covers the cost of repairs, you won’t have to pay out of your own pocket.
You need at least the minimum amount of liability required by your state. However, consider buying as much liability as you can comfortably afford. This way, you’ll limit the possibility of paying out-of-pocket costs. Your property damage liability is one of two parts of your liability insurance on your auto insurance policy. You’ll be able to select your desired property damage liability maximum when you purchase your auto insurance policy.
If you have property damage liability coverage, your insurer will help you pay costs that result from any damages you cause to someone else’s property. These costs may include:
Property damage liability doesn’t pay for your own car repair costs. For that, you’ll need collision car insurance coverage.
When you buy liability coverage, you can choose a combined single limit or split limit policy.
A combined single limit policy is written like this: “$300,000 each accident.”
This means you’re protected for $300,000 in the event of bodily injury and property damage costs. If you have to pay for damage to a fence as well as the medical costs of three people, then your policy will cover you. That is, as long as the cost falls within $300,000.
A split limit policy for liability coverage might be written like this: 100/300/50.
These numbers are just shorthand for how much your insurance will cover you for:
The three numbers will change to create different policies. Your state will most likely have policy minimums, but otherwise you’re free to choose the right mix for your own needs.
While driving, you lose control of your car and crash into a parked vehicle. Fortunately, you didn’t hit anyone and you aren’t hurt. You do, however, need to pay the repair bill for the damaged vehicle, which comes in at just over $9,000. You have 100/300/50 in liability coverage, so the damage is easily covered by your $50,000 in property damage liability insurance.
Unless you live in New Hampshire or Virginia, your state will require you to have a specified amount of property damage liability. Even in those states, getting car insurance is much easier than proving your financial responsibility.
Your state will require a minimum amount of property damage liability insurance that covers the typical claim for property damage, which is around $3,000. Costs can increase quickly in multicar accidents, so consider buying a higher amount of coverage.
In all states but Virginia and New Hampshire, you’ll need some amount of property damage liability to drive a vehicle. Your state will likely set a minimum coverage amount, but you can buy more depending on what you feel comfortable with. To find the best rates, compare car insurance companies at the coverage amount you need.
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