The simple definition of auto insurance liability coverage is that it pays for your legal responsibility to others for bodily injury or property damage.

Most states car insurance requirements include bodily injury and property damage liability coverages. It is important to have enough liability insurance, because if you are involved in a serious accident, you may be sued for a large sum of money. Definitely consider buying more than the state-required minimum to protect assets such as your home and savings.

Liability insurance does not protect you or your car directly. Bodily injury (BI) liability insurance covers you if you cause an accident injuring other people. It protects you against their claims up to the stated amounts for medical expenses, lost wages, pain and suffering and other losses. It will also usually pay if the accident was caused by a member of your family living with you or a person using your own auto with your consent. It does not pay for bodily injury you may sustain.

Property damage (PD) liability coverage pays for any damage to the property of others up to the stated amount provided by the policy (i.e., a crushed fender, broken glass, or a damaged wall or fence). Your insurance will pay for this damage if you were driving your auto or if it was being driven by another person with your consent. Property damage liability also pays if you damage government property like a light pole or signpost, up to the limit you choose.

Property Damage Liability insurance is protection for the cost of damage you cause to the property of others while Collision insurance covers damage to your own car caused by a crash or upset, less any deductible.

For more information on auto insurance coverages and their definitions visit our learning center.