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The Facts About Cheap Liability Auto Insurance

What you need to know about cheap liability auto insurance coverage

Auto liability insurance is considered the most basic auto coverage you can buy – and it's required in most U.S. states to drive legally. Simply put, if you want to drive, you have to have it.

But before you shop for cheap liability car insurance, it pays to know what a policy does and doesn't cover. The most basic policy may not provide the coverage you need if you're in a serious accident. For a slightly higher price, you could avoid big expenses.

There are two basic parts of liability auto insurance you should understand: bodily injury coverage and property damage coverage. Here are some key facts on each—and other details you need to know.

Fact 1: You must have bodily injury coverage

Most states require you to have bodily injury coverage. Bodily injury insurance covers the costs if people are injured or killed in an accident that's your fault. This pays for costs such as medical expenses, loss of income and, in some cases, legal fees if you are sued for injuring or killing someone. If the damages cost more than the limits of the coverage, you are responsible for paying the balance.

Fact 2: You must have property damage coverage

Most states require you to have property damage coverage. Property damage insurance helps pay for damages done to someone's property as the result of an accident caused by you. It may help cover the expense of repairing or replacing a car, fence or property you damaged.

Fact 3: Limits are important

If you have only the state minimum required insurance and you're deemed to be at fault in a costly accident, you may be stuck with part of a very big bill. Cheap liability auto insurance will have relatively low limits in terms of how much damage your policy will pay for. For example, if your limits are low and you hit an expensive sports car, you might have to pay the costs that exceed the amount your insurance company pays.

Fact 4: Liability requirements vary by state

While most states require you to purchase automobile liability insurance, the amount of coverage varies from state to state. Required state minimum limits are often very low and could put you in financial risk. If you have sizeable assets, you may want to consider personal umbrella insurance, which offers an extra layer of protection for a serious accident.

Fact 5: Higher levels give you more protection

While the cheapest, state-minimum liability auto insurance allows you to drive legally, it doesn't mean you’re fully protected in the event of a serious accident. If you have very low limits, you could be responsible for paying the balance of damages. Those costs can run in the tens of thousands of dollars in a major accident. Be sure to consider other coverage options as well; collision and comprehensive car insurance coverage help pay for damage to your vehicle.

Fact 6: Nationwide can help with cheap liability car insurance

Nationwide offers many online resources to help you sort through the confusing aspects of cheap liability car insurance. These vehicle safety articles or our insurance agents can answer any questions you may have.