Liability Car Insurance

Liability car insurance is a type of auto insurance that protects you if you get into an accident with another vehicle – this type of car insurance will pay for the damages to the other vehicle involved and any injuries sustained by its passengers. With the economy being so rough post-Great Recession, many consumers have chosen to save money by holding on to their vehicles longer (the current average age for vehicles is around 8 years), driving less (or not at all), or converting to liability car insurance – essentially dropping their comprehensive coverage (coverage for weather, vandalism, and theft) and collision coverage (coverage for your vehicle if you are in an accident) from full coverage auto insurance.

This practice will normally save you 30-40 percent off your auto insurance premium. On the contrary, there is a variety of reasons why liability car insurance is never really enough:

• It Only Covers Part of It: Liability car insurance provides coverage for the other driver’s vehicle and injuries, as well as his passengers. It also covers lawsuits and defense costs if you are sued, lost wages, medical bills, etc. However, given that most liability car insurance limits are less than $35,000 per person and $50,000 per accident, the likelihood that your liability car insurance policy will cover all the costs associated with the accident, leaving you to pay out of pocket for any amount over that, as well as pay for any damages to your own vehicle or injuries you sustain.

For example, if you do not have comprehensive coverage, you would have to pay out of pocket if you ran into a deer, were caught in a hail storm, or had your car vandalized. Even if your vehicle is totaled, if you do not have anything more than liability coverage, you get nothing.

• You May Be Required to Carry More: In addition, keep in mind that carrying only liability insurance may not even be an option for you – if you do not own your vehicle outright (e.g. you lease or you purchased your car using a vehicle loan or financing and are still paying on it), you are usually required to carry full coverage auto insurance as part of the terms of your financing agreement.