First of all, it is important to note that every state requires a minimum amount of liability coverage in order to legally drive a vehicle. In some states, you only need to show proof of having the personal financial resources to cover the minimum requirements levied by the state.
Liability insurance coverage is designed to protect you if you are found to be at fault for an accident involving injuries and damage to someone else and their property – as well as provide you with legal defense in the event the other party files a lawsuit against you.
What liability coverage does not pay for is any damage to your own vehicle or costs related to your own injuries from an accident you cause.
There are two parts to liability coverage: bodily injury liability and property damage liability. Both are considered to be mandatory types of auto insurance for most states.
Property Damage Liability
Property damage liability does not cover damage to your own property – regardless of who is at fault. It goes into effect when you are at fault in an accident and your vehicle has damaged someone else’s property. There are varying amounts of coverage you can choose from, depending on your state-imposed minimum requirements.
Bodily Injury Liability
Bodily injury liability coverage comes into play if you are found be at fault in an accident that results in an injury to another party. It does not cover your own injuries should you have any, nor does it pay for those of any other driver included on your insurance policy. Typically, this coverage takes care of: medical bills; physical therapy or rehabilitation; work time lost due to injury; funeral costs; and possibly “pain and suffering,” which a court can determine in the event they decide you are responsible for emotional or physical stress resulting from the accident.
When shopping for cheap auto insurance quotes online, you will normally see coverage limits stated like this: $25,000/$50,000/$25,000. To make it a bit easier to understand you will see the breakdown below.
- $25,000 for one person injured in an accident
- $50,000 for each accident in which more than one person is injured, and
- $25,000 for each accident that causes property damage
While these are the Alabama state liability minimum requirements as of 2011, the totals may differ from state to state. But, bottom line is – it is mandatory if you want to legally drive your vehicle.
Of course, you can increase the limits should you wish to do so. Deciding what you need will depend on your personal situation and the state you live in.
Contact one of our representatives to help you choose the amount of liability coverage that is best for you.