Go To Top
CAR Insurance

The real reason you buy auto insurance is liability coverage --which stands between your finances and disaster if you ever have an at-fault accident.

Even the best driver can cause an accident, and even the most careful person can be unlucky. That's why drivers in the U.S. are required to prove they can afford to pay for their mistakes if someone or something is hurt. In most cases, this is accomplished by purchasing at least a mandatory minimum amount of automobile liability insurance coverage. Driving without insurance, sometimes referred to as "going naked," is not advised.

Liability car insurance is the main type of car insurance that states requires -- but provides the most limited amount of coverage.

In this guide, you will learn about liability insurance policy, what does liability insurance cover, what are the coverage limits and answers to all the important questions about liability insurance.

  • Auto Liability insurance protects you if you are at fault in an accident that hurts another driver or causes damage to their vehicle
  • It covers bodily injury and property damage of another driver when you cause an accident
  • Liability car insurance will not cover your vehicle if you're at fault. You should buy comprehensive and collision coverage to pay for those damages
  • It will cover you up to its limits, so make sure you buy enough coverage that meets your needs.

What is Liability Insurance?

Liability insurance helps you pay for another person's bodily injury or property damage if you are at fault in an accident.

Drivers are required to buy a minimum amount of liability coverage. And minimum coverage you need will depend on your financial situation, the state where you live, and the value of the vehicle involved.

How much does auto liability insurance cost?

The average rate for minimum liability insurance coverage is $574 a year, or $48 a month, on average, based on an Insurance.com data analysis. Bumping that up to liability limits of 50/100/50 costs $644 annually, or $54 a month.

Depending upon where you live and what coverage limits you purchase, your annual premium for liability car insurance can vary significantly. Insurance.com acquired Quadrant Information Services data indicating  the average annual liability premium for a driver purchasing minimum coverage limits to be as low as $300 to $400 a year in some states, and as high as $800 -- even more -- in others.

If you buy a minimum liability policy, you will be getting the cheapest insurance rate. However, minimum coverage levels are not recommended because they can leave you financially exposed in an at-fault accident. Increasing your limits above state minimums provides more protection and doesn’t cost much more – averaging approximately $6 per month ($70 a year) above the cost of minimum coverage.

Let's find how much is liability insurance in your area from multiple carriers using our free online quote comparison tool. Answer a few questions to compare quotes side-by-side and even purchase your policy online.

State Liability Only - State Minimum BI/PD Liability Only - 50/100/50 BI/PD
Overall Average$713$780

Methodology: Insurance.com commissioned Quadrant Information Services to gather insurance rates for a 2019 Honda Accord for nearlly all ZIP codes in each state, from up to six major carriers, for a male driver, age 30.

What does auto liability insurance cover?

Auto liability insurance covers damage to vehicles and injuries of others that result from an accident you caused (are legally liable for is the fancy insurance term).

There are two kinds of liability coverage:

  1. Bodily injury coverage - covers medical costs, funeral expenses, lost income and pain and suffering of people injured by you.
  2. Property damage coverage - reimburses accident victims for the repair or replacement of belongings damaged by you. It covers both someone else’s car or property; for instance, if you hit a sign or house.

Both types of liability insurance cover you only up to your limits, and that is why it’s important to make sure you buy enough coverage for the protection you need.

Liability insurance also obligates your insurer to defend you if you're sued following a motor vehicle accident.

Things Liability car insurance covers

What liability auto insurance doesn't cover?

Examples of items that liability auto insurance doesn't cover: -

  • Liability insurance does not cover damage to your own vehicle if you are at-fault in an accident, you need collision and comprehensive coverageto pay for those damages
  • Nor does liability insurance reimburse you for medical expenses if you are at-fault in an accident, your personal health insurance plan may be able to cover unreimbursed medical costs along with car insurance medical coverages you may carry, such as personal injury protection or medical payments
  • Liability also does not cover claims that exceed the limits of your coverage, and it may not extend to legal defense exceeding your policy limits. Higher liability limits can help you to avoid paying out-of-pocket when damages exceed minimum limits, and an umbrella policy can offer limits of $1 million or more once your auto insurance limits are reached.

Liability car insurance coverage limits

States set their own minimum liability coverage requirements for property damage and bodily injuries. Requirements are usually expressed as a group of numbers. For example, California's requirements are 15/30/5. This means that in California, you must purchase a policy that provides at least:

  • $15,000 of bodily injury coverage per person injured in an accident caused by you.
  • With a maximum of $30,000 for everyone injured in that accident.
  • In addition, you must carry insurance covering at least $5,000 of property damage.

State minimum auto liability requirements

The list below shows the liability insurance minimums for every state. There are 12 "no-fault" states that require all drivers to carry personal injury protection (PIP) to pay for their medical expenses if involved in an accident. A few states, such as Maine and New Hampshire, require medical payments (MedPay), which also gives you some medical coverage if your or your passengers are injured in an auto accident.

Many states require you to carry uninsured motorist bodily injury (UM)/underinsured motorist (UIM) coverage. Some states require uninsured motorist property damage (UMPD).

While most but not all states require drivers to carry auto insurance – Iowa and New Hampshire are exceptions – all states do have financial responsibility laws requiring that drivers are able to pay for damages caused to others. And even in Iowa and New Hampshire that don't specifically require car insurance, the easiest way to comply with the financial responsibility laws is to buy a car insurance policy.

Florida is a special state. One law on the books indicates that purchasing bodily injury liability coverage is optional. However, under a different financial responsibility law, drivers could be penalized if they don’t carry bodily injury coverage and are responsible for injuries they cause in an auto accident. To be safe, consider carrying at least the minimum limits listed below.

StateMinimum liability coverage limitsOther types of insurance required (if any)


District of Columbia25/50/10UM, UMPD


Kansas25/50/25UM/UIM, PIP


Maine50/100/25UM/UIM, MedPay
Maryland30/60/15UM/UIM, UMPD, PIP
Massachusetts20/40/5UM/UIM, PIP
Michigan50/100/10PIP, property protection
Minnesota30/60/10UM/UIM, PIP


New Hampshire**25/50/25UM/UIM, MedPay
New Jersey15/30/5UM/UIM, UMPD, PIP
New Mexico25/50/10
New York25/50/10UM, PIP
North Carolina30/60/25UM, UMPD
North Dakota25/50/25UM/UIM, PIP
Oregon25/50/20UM, PIP
Pennsylvania15/30/5PIP - referred to as “First Party Benefits Coverage”
Rhode Island***25/50/25
South Carolina25/50/25UM, UMPD
South Dakota25/50/25UM/UIM
Vermont25/50/10UM/UIM, UMPD
Virginia25/50/20*UM/UIM, UMPD
West Virginia25/50/25UM, UMPD

* Florida doesn't require bodily injury liability coverage, but many insurers only offer policies with at least minimum amounts of 10/20 of BI coverage.

** In New Hampshire auto insurance isn't mandatory, but if you choose to buy insurance these are the minimum amounts.

*** Rhode Island doesn't require drivers to buy UM/UIM coverage if buying minimum liabiity coverage. If buy higher liability limits, UM is required.

How much auto liability insurance should you buy?

Most experts agree that the legally-mandated minimum coverage is not enough for many drivers. The amount of car insurance coverage you should purchase depends on your assets and your tolerance for risk.

Use our auto insurance coverage calculator to find out what coverage limits best fit your needs.

If you cause an accident that seriously injures the other party, medical bills, income loss, and pain and suffering claims could come to hundreds of thousands of dollars. If you have assets above the limits of your policy, the victim's attorney is likely to pursue them. In addition, many insurance policies allow insurers to limit their legal defense expense to your coverage limit.

Drivers without home equity, savings or other assets

If you have little savings (outside of retirement accounts which are protected) and no home equity or other valuable assets, the state-mandated coverage may be enough. However, in states with very low minimums, the minimum is probably insufficient.

Penny Gusner, senior consumer analyst, Insurance.com, recommends that you buy at least $50,000 in property damage liability. Gusner also recommends that drivers buy at least $100,000 of bodily injury insurance per person, and $300,000 per accident. How much is liability insurance with this extra coverage? Fortunately, the minimum policy is the most expensive. It only costs about 20 percent more to purchase $300,000 of coverage than it does to purchase $100,000.

Drivers with significant assets

If you have accumulated more extensive holdings, like real estate, investments and expensive collections, your coverage should probably be broader, such as 250/500/100 ($250,000 bodily injury/$500,000 BI for all involved in an accident/$100,000 property damage), or higher if your insure offers greater limits.

Personal finance gurus routinely recommend that your liability coverage should be at least as high as your net worth. If you're a top earner or have obvious wealth, your financial position could make you a target for lawsuits. For that reason, you might want to consider an umbrella policy, which kicks in when your homeowners or auto liability coverage is exhausted. Umbrella coverage is surprisingly inexpensive for the amount of coverage you can purchase ($1 million of coverage costs a few hundred dollars per year).

Penalties for driving without liability insurance

According to the latest Insurance Research Council (IRC), one in eight drivers do not carry legally-required auto insurance. Driving without insurance could save money in the short run, but it can result in serious penalties.

In most states, if you cause an accident, you will be forced to cover the resulting damages. This may drain your savings, and it is possible that a lien could be placed on your home and other assets. Up to 25% of your future wages could be garnished.

The Insurance Information Institute (III) reports that in 2018, the average auto liability claim for bodily injury was $15,785 while the average cost for property damage was $3,841. Without insurance, you'd have to cover this out-of-pocket. If you're taken to court and lose, you could be forced to pay for your victim's legal fees as well as your own. And you'd still have to repair or replace your own car.

If you don't cause an accident but are pulled over and caught driving without insurance, you may face:

  • Driver's license suspension
  • Registration suspension
  • Fines ranging from $600 to $5,000
  • Additional lapse fees due to your DMV
  • Vehicle impoundment
  • Jail time or community service
  • Points on your license
  • A requirement to carry SR-22 insurance
  • By driving without insurance, you're gambling with your future.

Shopping for liability car insurance

It can be smart to review your policy once a year or so and make sure that your assets and income are fully protected. Even if you don't need to increase or decrease your auto liability insurance, it’s useful to compare auto insurance quotes to make sure that you're getting a good deal. Make sure the quotes you receive all include the same coverage so that you can make a valid comparison.

When you have a life-changing event during the year – such as adding a teen driver, marriage, divorce, moving, adding or removing a vehicle – it’s particularly important to comparison shop.  Your current insurance company may not have the cheapest rates and you could miss out on saving hundreds, or even thousands, of dollars each year by not taking 20 minutes or more to shop around.

Auto Liability FAQs

Is auto liability insurance required?

If you own a car, you should buy at least the state-mandated amount of auto liability coverage. It helps you cover another person's injury and damage to property in an at-fault accident. It is typically required for two reasons:

  • Being certain that other parties are fairly compensated for any kind of bodily injury or property damage in case of a vehicle accident
  • To make sure that drivers have sufficient coverage so they can pay for their injuries or property damage in an at-fault accident

I don't own a car but I have a driver's license. Am I required to buy liability insurance?

No. Presumably, the car owner's insurance would cover you if you cause an accident. Non-owner car insurance is a great option if you don’t own a car. However, even if the law doesn't require you to purchase insurance, you might want more coverage than the car's owner has. Purchasing a non-owner policy protects you if the car owner's policy doesn't offer enough protection.

However, if you live in a household where you frequently borrow a car, or drive a friend’s car regularly, you should be added to the owner’s policy as a driver. You don’t have to own the car to be added to the policy as a driver.

Does my policy protect me outside the United States?

A standard policy only covers outside the U.S. if you travel to Canada. Driving in Mexico or other countries requires international insurance. Some insurers offer “border insurance” you can purchase if you are planning a trip into Mexico.

Are legal fees included in the policy limits?

No. The coverage for bodily injury and property damage is separate from the legal defense fees.

The bottom line is that without auto liability insurance, you are gambling in a very high stakes game. Insurance.com enables you to quickly research competitive auto insurance quotes by completing a brief form. Take a minute to explore insurance options that meet your needs.Start now!

questions about liability insurance

Helpful Auto Insurance Articles & Guides