Liability Coverage
Liability Coverage is a key component of car insurance that helps cover the costs associated with damage or injury you cause to others in an accident where you are at fault. It’s typically divided into two main types:
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Bodily Injury Liability (BIL): This covers medical expenses, lost wages, pain and suffering, and legal fees for the other party if you are responsible for an accident that injures them. It may also cover funeral expenses in the case of a fatal accident.
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Property Damage Liability (PDL): This helps pay for the damage you cause to someone else’s property, such as their vehicle, a fence, or a building, in an accident that’s your fault.
Key Points about Liability Coverage:
- Required by Law: Most states require drivers to have at least a minimum amount of liability insurance to legally drive.
- Limits: Liability coverage comes with specific limits. For example, if you have a liability limit of $25,000 for bodily injury, your insurer will pay up to $25,000 for the medical expenses of an injured person (subject to your policy terms). If the costs exceed that limit, you could be responsible for paying the difference.
- No Coverage for Your Own Injuries: Liability insurance does not cover your own medical expenses or vehicle repairs. It only applies to damages and injuries you cause to others.
Liability coverage helps protect you financially by covering the costs associated with accidents you cause, but it’s crucial to ensure that your coverage limits are adequate to avoid paying out-of-pocket if you cause significant damage.