Liability only car insurance, also known as third-party car insurance, is a type of car insurance policy that covers the cost of damage or injuries caused to other people or their property when you are at fault in an accident.
This type of policy does not cover damage to your own car or injuries that you sustain in an accident.
Liability Only Car Insurance
Liability only car insurance is mandatory in most states, as it ensures that drivers are financially responsible for any damage or injuries that they cause in an accident.
In many states, drivers are required to carry a minimum amount of liability insurance coverage.
Liability only car insurance policies typically cover two types of liability: bodily injury liability and property damage liability.
Bodily injury liability covers the cost of injuries that you cause to other people in an accident. This can include medical expenses, lost wages, and pain and suffering.
Bodily injury liability coverage limits are typically expressed as two amounts, such as $50,000/$100,000.
The first number represents the maximum amount that the policy will pay per person for injuries caused by the policyholder, while the second number represents the maximum amount that the policy will pay per accident.
Property damage liability covers the cost of damage that you cause to other people’s property in an accident, such as their car or their home.
Property damage liability coverage limits are typically expressed as a single amount, such as $25,000 or $50,000.
Liability only car insurance policies do not provide coverage for damage to your own car or injuries that you sustain in an accident.
This means that if you are at fault in an accident, you will be responsible for paying for the cost of repairing or replacing your own car, as well as any medical expenses or other costs associated with your injuries.
Liability only car insurance policies are generally less expensive than comprehensive or collision insurance policies, as they provide less coverage.
However, it’s important to note that liability only policies may not provide enough coverage in the event of a serious accident.
For example, if you cause a multi-car accident and the total cost of the damages and injuries exceeds your policy limits, you could be personally responsible for paying the remaining costs.
When deciding whether or not to purchase liability only car insurance, it’s important to consider your financial situation and the value of your car.
If you have a high-value car or a lot of assets that could be at risk in the event of a lawsuit, it may be worth considering purchasing additional insurance coverage.
It’s also important to note that liability only car insurance policies do not provide coverage for certain types of accidents, such as hit-and-run accidents or accidents caused by an uninsured or underinsured driver.
In these cases, you may need to purchase additional insurance coverage, such as uninsured motorist coverage.
When shopping for liability only car insurance, it’s important to compare rates and coverage options from multiple insurers.
Be sure to read the policy carefully and understand what is and is not covered, as well as any exclusions or limitations.
Final Words
In summary, liability only car insurance is a type of car insurance policy that provides coverage for damage or injuries caused to other people or their property when you are at fault in an accident.
This type of policy is mandatory in most states and typically covers bodily injury liability and property damage liability.
Liability only car insurance policies do not provide coverage for damage to your own car or injuries that you sustain in an accident, and may not provide enough coverage in the event of a serious accident.
When shopping for liability only car insurance, it’s important to compare rates and coverage options from multiple insurers and to carefully read the policy to understand what is and is not covered.