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What is Liability Car Insurance?

by Autobytel Staff
May 20, 2011

Having car insurance when you own a car is an absolute must in the United States but the amount of insurance you are legally obligated to carry varies from state to state. In most cases, the minimum amount of car insurance to have as a legal driver is liability car insurance coverage.

What liability vehicle coverage can do for you in case of an accident is protect you from the damage caused if you are the responsible party. In many states, if you rear end someone when coming to a stop then you are automatically at fault and are therefore responsible for any damage to the car in front and the medical expenses of its occupants. This type of situation is just one example of when liability auto insurance coverage will come into play to protect you.

No matter what kind of car accident you are involved in it is always a hugely traumatic personal experience. But not having liability car insurance coverage can help lessen the pain of the entire experience as it not only pays for damage to the other party’s vehicle but also pays for any related medical expenses. Medical costs in this country are skyrocketing so this should be a concern to every safe driver and liability vehicle insurance can help assuage concerns about that.

How Much Liability Coverage Do You Need?

When most people go shopping for liability car insurance, their main concern is finding a premium that is the most affordable each month. While that may help you with your personal monthly budget, it may prove disastrous in the event of a very serious accident where there is a great deal of damage to the other car and medical bills turn out to be astronomically high and liability auto insurance would have been a good investment.

Your first instinct may be to just buy the minimum amount of liability auto insurance coverage and this may wind up only covering a small percentage of the costs you are responsible for after the accident. While repairing the other party’s car on average rarely tops $30,000 in a serious accident, if you cause an injury to another party that causes a disability you may be responsible for years of their medical costs.

Not to be alarmist but we live in a highly litigious, lawsuit-happy society and one moment of bad luck behind the wheel could be the cause of financial ruin for your family if you decide to buy the minimum amount of liability auto insurance coverage. So carefully consider the possibility of how bad it could get in case of an accident when deciding how much liability auto insurance to buy.

Adjusting Your Deductible to Save Money

One way to save money on your monthly liability auto insurance coverage deductible is to pick a higher deductible amount. The deductible is variable with most premiums and can vary from $500 all the way up to $5,000. You need to remember that when you have an accident, you will have to immediately pay this deductible to cover your portion of the damages. If you don’t usually have a lot of money in an emergency savings account, it is wisest to go with the lowest deductible you can afford on your liability auto insurance.

Low Income Liability Auto Insurance Programs

Most states work with various auto insurance companies and even have their own programs to offer liability auto insurance coverage at lower rates to drivers with low annual incomes. To apply for these programs you have to prove you meet the income requirements and if you think you might qualify, don’t hesitate to ask your insurance agent to see if they have any such programs.

Driving without liability insurance coverage is not only illegal in most states but it is also extremely unwise. Accidents can happen to even the best defensive driver and you and your family’s financial security could very well depend on picking the right amount of liability auto insurance coverage.


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