Deciding On Auto Liability Coverage: What You Need To Know
Auto liability insurance is one of the most basic types of coverage you can have on your vehicle. In fact, across the United States, you are legally required to carry this type of insurance in order to drive on public roads. Still, nobody wants to pay for more coverage than they need--so taking the time to fully understand auto liability coverage will help you decide on the right amount for your needs.
Understand What's Covered
Auto liability coverage generally consists of two parts: personal injury liability protection and property damage protection. This means that if you're involved in an accident and somebody is injured or killed, your policy's personal injury protection will pay out a certain amount to cover medical expenses, funeral costs, or other related costs. With property damage coverage, your policy will pay for damage done to a person's property, such as their vehicle as a result of an accident.
Consider Your State Requirements
When deciding on how much liability coverage you need, you'll want to consider the specific requirements of the state in which you live and operate your vehicle. Each individual state sets their own unique requirements for minimum coverage, and these requirements can vary greatly from one state to the next.
Check With Your Lender
In addition to making sure you carry at least your state minimum coverage, you should also check with your lender for their coverage requirements if you're still making payments on a car loan or lease. Often times, lenders will require that you carry full-coverage insurance, which includes liability coverage amounts that are greater than the state minimum. Depending on your lender's requirements; for instance, you may need to carry as much as $500,000 in bodily injury coverage and $100,000 in property damage coverage per incident.
Look Into Other Coverage Options
In addition to having the right amount of liability coverage, there are other types of coverage you may want to add to your auto insurance policy for extra protection and peace of mind. Collision and comprehensive coverage, for example, can provide you with added protection if your car is damaged in an accident, by vandalism, or severe weather (such as hail).
Deciding on the right amount of liability coverage requires a solid understanding of what this coverage entails and what types of requirements may be set forth by your state and lender (where applicable). And by having the right amount of coverage for your needs, you can enjoy greater peace of mind behind the wheel.