Basic Liability Auto Insurance

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Basic Liability Auto Insurance

Basic Liability Auto Insurance

Shopping for automobile insurance can be confusing for almost anybody. If it’s your first time buying a policy, figuring out what coverage is best for you can be overwhelming. People get confused because they are unsure of the type of auto insurance to get and the amount of coverage needed. While collision and comprehensive insurance are optional, you must purchase a minimum amount of basic liability auto insurance in all but one state. New Hampshire is currently the only state that does not mandate liability coverage for drivers. 

The amount of liability car insurance you need to get varies state by state. Each state sets its laws regarding mandatory insurance limits. You should check out your state’s requirements before you go out and buy a new car insurance policy. Insurance laws change from time to time, so even though you heard or read about a set of numbers 3 or 4 years ago, those minimums could be much higher today. First, though, let us delve into basic liability insurance a little deeper and what it covers.

What exactly is Liability Car Insurance, and what does it Cover?

The most basic type of coverage you can get for your vehicle is state minimum basic liability insurance. As the name implies, this coverage will kick-in after you cause a crash that you are liable for. Liability covers damages to the other person. It includes both physical injuries and property damage. 

The main thing you need to know is it does not compensate you for damages to your car or injuries you might sustain in the incident you were deemed at-fault for causing. Liability insurance is so limited that it is almost always the cheapest car insurance policy you can buy. 

Just remember that while the policy itself is inexpensive, getting into a serious accident you were responsible for could wreck you financially. This is because the damages would more than likely far exceed the coverage of your policy. Let’s say you texted while driving and hit another vehicle carrying four passengers. You caused over $500,00 in medical bills.  Totaling a $20,000 vehicle basic liability auto insurance would not cover the accident costs. You would still be held liable and, through court, would have to settle with the victims. It might mean years of paying restitution for the accident you caused. As you can see, state minimum liability insurance could cost you a lot if you get into a severe accident.   

Why Should You Buy Liability Auto Insurance?

The most important reason you should get this type of coverage is that it is mandated by law. If you get caught driving without insurance, you could face stiff penalties and even have your car impounded. Even worse, if you drive without insurance and get involved in an accident, you will most likely get sued. This means you could have your wages garnished for years to pay what you are liable for due to the accident.

Getting covered will protect you from possible litigation up to the number of your policy limits. It’s so important to buy insurance based on the assets you have accumulated. If you have $100,000 in the bank, make sure you have a policy that covers you for most, if not all, of the $100,000 you’ve saved. If you can afford to, raise your policy’s limits to an amount that covers you if you get into a significant accident.  

Liability Insurance Ratios Explained

There’s a set of numbers you should familiarize yourself with that pertain to the coverage amounts. Here is a brief outline of each number in the set: 

Let’s say an agent advises you to buy a 50/100/30 policy.

  • 50: This first number is the maximum amount, in this example $50,000, that would compensate the passengers in the vehicle you hit and passengers in your car per injury.
  • 100: The following number is the total amount your policy would pay for all injuries sustained in the accident, $100,000.
  • 30: Lastly, the 3rd number in the set is the maximum for property damage that would payout; in this example, it’s $30,000.

You might ask what would happen if you exceed those limits? The answer is you are still liable and will need to pay. So, it is essential and cannot be stressed enough, to get as much auto insurance coverage as you can afford. You can buy basic liability auto insurance coverage direct on the web or from agents and brokers. 

Every licensed insurer will be able to sell you basic liability car insurance in the states where the company is licensed. However, you might want to combine it with other protection, like medical payments and uninsured driver coverage. Several states require you to purchase uninsured motorist protection. Remember that liability is only a “bare-bones” minimum policy that can leave a driver exposed to a severe wreck. 

Upgrading to Collision and Comprehensive Insurance Coverage

Typically, if a person is on a very tight budget and drives an older vehicle worth less than $6,000, it makes sense to get basic state minimum car insurance coverage.

However, suppose you have assets that you need to protect along with an expensive automobile you have invested a lot of money in. In that case, you should consider adding collision and comprehensive to your policy. You can offset the additional expenses by getting a higher deductible of $1,000 or higher. This one tip will bring your premiums down about 15%, but you need to save up your deductible amount if you ever get into a crash and file a claim. You can also save a lot by bundling your auto and home insurance together, giving you one convenient bill to pay each billing cycle, and saving you 5% or more.

How to Get Cheap Liability Auto Insurance

The best place to get cheap basic liability auto insurance is on the web. More consumers are starting their search for the most affordable car insurance rates online. Carriers like GoodToGoInsurance have responded with direct-to-consumer pricing and deals that can save you hundreds per year.  

Make sure you get multiple auto insurance quotes, so you have a large sample of different rates to choose from. You can use free quoting sites like good to go insurance, which will give you up to 10 quotes in about five minutes. 

There is no obligation to buy a policy, and you will only receive quotes from top-rated insurers. Get your free car insurance quote today and see how easy it is to save hundreds on the coverage you need.