Liability Car Insurance
As a driver you have responsibilities and one of those responsibilities is related to the liability car insurance. This is coverage mandatory in all the American states and is less costly than a full coverage. That’s because a full coverage policy will protect all the vehicles involved in the collision, will cover the medical bills of all the persons injured in the accident and will also pay for all the property damage resulted.
The minimum amount of liability car insurance required by law depends on the state you live in and it is designed to pay for the damages you as a driver and your car cause to other vehicles and to private or public property. You will usually find the minimum liability ca insurance expresses like this: 25/50/15, because it involves minimum coverage for these different situations. The amounts represent thousands of dollars, so the first number suggests that a minimum amount of $25,000 represents the coverage you need to purchase in case a single individual is injured as result of an accident in which you are found at fault. The second number refers to the coverage that will be used to protect all the persons that are injured in an accident you caused, while the last $15,000 represent the coverage that will apply in case of property damage. So, to legally drive a car in any American state you need to purchase an insurance policy that includes the minimum amounts specified by the law in this simplified format.
This may seem like a lot of money, but in fact these minimums may not be enough in case of a serious accident. Therefore, if you are involved in an accident that causes injury to the other driver and his medical bills add up to around $100,000, the minimum liability car insurance required by law will cover only $25,000 (in our example). You may wonder what happens to the $75,000 difference. Well, considering that you were the one found at fault in the accident, the other driver has the right to get that difference from your pocket. This may be possible or not depending whether you live or not in a “no-fault” state, but there are only 12 such states. In a “no fault” state, the driver found at fault will pay up to the limit of the policy he purchased and you can’t sue him unless the damages you think he should cover represent more than $250,000. That’s the amount established in some “no fault” states while others set even higher limits.
The more expensive option is to buy a full coverage that will include the liability car insurance and two extra types of coverage: comprehensive and collision coverage. You can purchase comprehensive coverage and not collision coverage, but the other way around (collision without comprehensive coverage) it’s not possible. If you decide to purchase an insurance policy that includes the liability state required minimum amounts and comprehensive insurance you are making a compromise. The comprehensive coverage is designed to protect you and your car against other phenomenon that don’t involve a collision. Some examples would be a theft or a natural disaster. The collision coverage is optional but if you bought your car through a loan you will have to purchase it.
What you should keep in mind about liability car insurance is that it is mandatory and absolutely necessary if you are involved in an accident. If you want to avoid any additional cost you can consider comprehensive and collision coverage as well and raise the minimum liability amounts to higher values that provide more safety.
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