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Common Misconceptions about Liability Auto Insurance

People have plenty of misconceptions when it comes to auto insurance, and liability auto insurance is certainly not an exception. This type of coverage will offer financial assistance to drivers who are at fault of causing an accident. Causing an accident is a big enough burden by itself, but having to pay for all the damage caused can be a disaster. However, there are limits to what liability insurance can cover, and you should be well informed about these limits.

@ Car-AccidentLiability insurance is the most common type of car insurance that is required in most states. It is composed of two coverage types: bodily injury insurance, which pays for injuries suffered by others because of your fault in an accident, and property damage insurance, which pays for damage that you have caused to someone else’s property. In both of these cases, a very common misconception is that liability auto insurance will pay for personal injuries and/or damage resulted from an accident which you have caused. This is not true, since liability insurance will only cover losses suffered by others, while fixing your own problems will be strictly your responsibility. It does not make this type of coverage any less effective though, since paying for other people’s damage could cost you a lot more than paying for your own.

Another misconception is that liability insurance is unlimited. This is false, because each state that requires drivers to have liability insurance has its own set of minimum limits for individual car insurance policies. The limit refers to the maximum amount your car insurance company will pay in a claim. These are categorized as per person bodily injury, total bodily injury and property damage limits.

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