Auto Liability Insurance

Auto liability insurance represents one slice of the overall insurance solution you decide on in the end, but a very important slice. This type of coverage is held in such high regard that, while such familiar components as collision and comprehensive insurance are optional, buying automobile liability insurance is mandated nationwide. If you are beginning your hunt for an auto protection package for the first time, or considering switching from your existing provider, chances are that you have heard plenty of references to car liability insurance. Chances, equally, are that you do not fully understand what liability entails, why it is important, and what options you do have concerning it.

What Liability Is

Vehicle liability insurance is what financially protects you and your assets if you are in an accident -- determined to be your fault -- in which there is damage to another party's property or bodily injury. Liability additionally applies to circumstances that are not necessarily traffic collisions, but in which your vehicle damages another party's property or person. For instance, if your auto were to careen off the roadway and into a storefront, mailbox, or even a parked car, funds from your automobile liability insurance would be called upon for repair or replacement. You will often see auto liability insurance written in a sort of insurance shorthand that includes three sums, separated by slashes. It appears as follows: $50,000/$100,000/$50,000, referring to bodily injury per individual/bodily injury per accident/and property damage.

This auto coverage can apply to many scenarios you may not think of when you think of your average auto accident. For instance, under the liability subheading of "bodily injury," financial compensation can be rendered to an injured party who has to miss work and thereby loses income. In worst case situations, funeral expenses and/or bail money could be pulled from this same allocation of insurance. If you are sued following some type of vehicular damage, liability can keep your own property and assets safe. Summarily, if it is determined that your auto has caused damages, automobile liability insurance can become your number one resource in defending yourself and your belongings. If information concerning this base-level component of auto insurance seems interesting enough but largely irrelevant since you are legally required to purchase it, know that there are many additional considerations.

Whether You Need More

A primary consideration is whether auto liability insurance is enough coverage for your auto; another is whether the mandated minimums within this category are enough. The established minimums and other details of this insurance will vary from state to state, and your broker will gladly inform you of precisely what your jurisdiction's requirements are. When you find out the bottom limits you are able to purchase, they may sound high enough to protect you. If you are on a budget or simply hoping to shave a little off the quoted amount of your monthly premium, you may wish to stick to minimal coverage. Before you opt out of higher-limit protection, make sure you have mulled over how costly medical bills, reimbursed income charges, and auto repair (or even auto replacement when it comes to extreme damage) can become. Low limits could easily translate into insufficient limits, and you could find yourself paying out of pocket.

Another practical point is that this means of auto protection does not help you when it comes to your own personal bodily injury or property damage/loss resultant from an auto accident. If you are involved in a mishap that is attributed another party when that party has either no policy or coverage insufficient for your needs, liability will not be of assistance to you. Imagining the circumstance again where you are at fault, it is very reasonable to expect that your own auto would be damaged as much as, if not more than, the no-fault party's vehicle. If you have not chosen additional categories of coverage, you would be left without a monetary buffer, and you would need to dip into your personal funds to deal with all needed repairs. Additional damages not covered include theft, storm damage, vandalism, and more.

Because auto liability insurance represents a sizable portion of your complete bill, it may be tempting to keep it to minimal requirements or eliminate complementary insurances in the name of keeping your costs low. If you have an older, inexpensive car, this may be a reasonable solution; comprehensive and collision only cover your vehicle up to its actual cash value. However, for others, capital lost if and when an accident does occur can far outweigh the percentage saved on monthly premium payments by choosing less coverage. As is the case at multiple junctures along the way, your agent can be your greatest asset when it comes to making the wisest decisions.


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