LIABILITY COVERAGE (AUTO)
Updated: Sep 30, 2019
No matter how careful of a driver you are, vehicular accidents happen. When they do, the driver who is at fault is responsible for any damages that occur. This includes paying for the medical expenses of those who are injured, the wages lost by the injured person who cannot work due to the injury as well as for the property that was damaged. As part of the privilege of driving, and to guard against a financial catastrophe if you are at fault for a vehicular accident, the state of California requires you to have a minimum amount of liability insurance.
What is Liability Insurance Coverage?
Liability insurance pays for the damage other people suffer due to an accident that is your fault. Liability is purchased for both bodily injury and property damage. Bodily injury covers the medical expenses incurred by a person harmed in the accident as well as wages that a person loses as a result of the injury. It also pays funeral costs if a death results. Property damage is what it sounds like. It pays for repair or replacement of the property that was damaged as a result of your negligence in causing the accident.
Levels of Coverage
There are two aspects to bodily injury coverage. One is the amount your insurance will pay each person who is injured in the accident. The other is the total amount the insurance will pay for one accident. The minimum amount of coverage the state of California requires you to have is $15,000 per person and $30,000 per accident. Medical bills add up quickly. Even what may seem like a minor injury may quickly exhaust the limits. That means you are personally responsible for paying the balance that is left after your policy limits are exhausted.
California law requires you to carry at least $5,000 in property damage coverage. As with bodily injury, if the cost to repair or replace the damaged property is more than the minimum, you will be personally responsible for the balance left over after your insurer pays the $5,000.
Most insurers recommend that you purchase coverage for at least $100,000 per person, $300,000 per accident and $100,000 for property damage. Your insurance agent will help you determine the best coverage amounts for your individual needs and financial situation.
Of course, the higher the limits you purchase, the greater your premium will be. But, when you consider the potential for out-of-pocket expenses you may be forced to pay if the damages are greater than the amount of your policy, the extra in premiums may well be worth the cost.
Damages That May be Available to a Person Injured in a Vehicular Accident
You may think that the damages to an injured person might not be very high. Think again. Some of the damages to which an injured person may be entitled include, but are not limited to:
1. Medical expenses; both currently incurred and expected to be incurred in the future;
2. Lost wages;
3. Rehabilitation expenses;
4. Long-term nursing care if required due to the nature of the injuries suffered.
The expenses of someone injured in an accident can be exorbitant. It may be that coverage greater than the minimum legal requirement is in your best interest. At the very least, obtain quotes for higher coverage so you can make an informed decision.