What Does Liability Insurance Cover?

November 1st, 2018 by

Claims adjuster taking notes next to a scratched car

First, let’s talk about the auto liability insurance definition. Liability car insurance compensates other parties if they’re hurt or their property is damaged in a car accident where the insured is the “at-fault” driver. What does liability coverage pay for? There are two types of liability car insurance: property damage and bodily injury liability. If you were responsible for causing an accident in Mesa, your insurance would cover the other party’s medical bills, lost wages, pain and suffering, and car repair expenses.

How Does Liability Insurance Work?

Here’s an example: The brakes pads aren’t your car aren’t great; you’ve been meaning to get them replaced, but haven’t gotten around to it. One day, you’re approaching a stop sign and when you press the brake pedal, the car won’t stop immediately. By the time you’re able to stop, you’ve rear-ended the car in front of you. In this situation, you’re liable for property damage and medical expenses sustained by the driver you rear-ended. Your insurance company covers the costs and helps protect you financially.

Liability Limits

Going back to the above scenario — as the at-fault driver, you wouldn’t receive injury and property damage compensation. This type of insurance pays damages to parties who were injured in an accident caused by the insured.

How Much Liability Auto Insurance Do I Need?

Except for New Hampshire, all U.S. states require general liability insurance. Property and medical payments coverage requirements vary from state to state. Here are the minimum coverage limits for Arizonans:

  • Bodily Injury Liability Coverage: Minimum $15,000 per person / $30,000 per accident
  • Property Damage Liability Coverage: Minimum $10,000

Learn More About Auto Insurance Requirements from Cactus Jack's Auto in Phoenix!

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