what does liability car insurance cover

When you’re looking at car insurance policies, you’ll notice that liability coverage is almost always the foundation. It’s the part of your policy that’s required by law in most states, and for good reason. It’s designed to protect your finances if you’re found at fault in an accident. But to make sure you’re properly protected, it’s crucial to know exactly what does liability car insurance cover.

Breaking Down What Liability Car Insurance Covers

Liability insurance is split into two main parts, and it’s helpful to think of them separately. The first is Bodily Injury Liability. This covers the costs associated with injuries to other people when you cause an accident. This can include their medical expenses, lost wages if they can’t work, and even legal fees if you are sued. The second part is Property Damage Liability. This covers the cost of repairing or replacing someone else’s property that you damage. This typically means the other driver’s car, but it can also extend to things like a fence, a mailbox, or a storefront.

What Your Liability Limits Really Mean

When you see your policy written as three numbers like 100/300/50, that’s your liability limits. The first number (100) is the maximum, in thousands, your insurer will pay per person for bodily injury. The second number (300) is the maximum it will pay for total bodily injury per accident. The third number (50) is the maximum for property damage. It’s wise to choose limits that protect your assets, like your savings and your home, not just the state minimum.

What Isn’t Covered by Liability Insurance

It’s just as important to know what this coverage doesn’t do. Liability insurance does not cover any of your own medical bills or the repairs to your own car after an accident. For that, you would need separate coverages like collision, comprehensive, or medical payments. Its sole purpose is to protect you from the costs you create for others.

Having a solid grasp of your liability coverage gives you confidence on the road. It’s the fundamental protection that ensures a single mistake doesn’t lead to financial hardship, allowing you to drive with greater peace of mind.