Liability coverage is the most basic type of Auto Insurance Coverage. Most of
the states in US require you to carry at least the liability coverage in your
auto insurance policy. The drivers can be penalized for driving without
Liability insurance under the state laws.
As the word, Liability itself means responsibility towards the other, something
that you owe to another person. It is very clear that the Liability coverage
covers you against all the damages done to another person’s car in an accident
by your fault. If you have totaled the other person’s car, it would include the
price of new car. Under liability coverage damages done to your car are not
covered. Another type of liability coverage is bodily injury liability that
covers you financially for the injuries that someone might sustain in an
accident caused by you. Although both types of liability coverage is not
necessary to buy in many states.
The Liability coverage is written in numbers like 20/60/10, where each number
represents different component of liability insurance. The first number
indicates the total amount your insurance company will pay for the body injuries
sustained by a single person per accident. The second number signifies the total
cost that the insurance company will pay for all the bodily injuries sustained
by a group of people in an accident caused by you. The last number is the total
amount that your insurance company agrees to pay for all the property damages.
All these numbers represent thousand dollars in maximum.
Liability Auto Insurance Cover does not cover you for the damage done to your
car in an accident or any other damage due to fire, theft, glass breakage or
vandalism. It also does not cover you in the case of bodily injuries sustained
by you. The insurance company is liable to pay only that amount less deductibles
to the other person involved in accident caused by you. It would be a nice idea
to have only liability cover if your car is few years old or you plan to drop
your car the next year or so. Apart from that various discounts can help you
lower your premium.
