What is auto liability coverage?

Liability insurance coverage protects you financially if you're responsible for someone else's injuries or property damage during a covered accident or event. In nearly every state, drivers are required by law to carry it on their policies.

What does liability insurance cover?

Liability car insurance falls into two categories. Each covers different items.

Bodily Injury liability coverage (BI coverage)

Helps pay for bodily injury for which you are legally liable. This means that your actions caused injury to another person and you were found legally responsible for those injuries.

What does BI coverage help pay?

Medical expenses
Lost wages
Pain and suffering
Defense and court costs if you are sued

Property Damage liability coverage (PD coverage)

Helps pay for damage done during a covered event to another person’s or company’s property, as well as for the loss of use of that property. This means that your actions caused damage to property (a car, a house, a tree, etc.) and you were found legally responsible for those damages.

What does PD coverage help pay?

Vehicle repair
Removal of a damaged tree
Repairs to a building wall you crashed through
Defense and court costs if you are sued

What car liability insurance doesn't cover

If you're responsible for an accident, your liability coverage won't pay to repair your vehicle, nor for injuries that you personally sustained. You’ll need separate coverages for these exposures, including collision coverage, comprehensive coverage, and medical payments coverage.

See all coverage options

Coverage in action

Let’s say you accidentally get into a fender bender or worse. If you are found responsible for the accident, liability would help cover the repairs to the other party’s vehicle.

Frequently asked questions about auto liability

The minimum amount of liability coverage you’re legally required to carry varies by state. Your premium cost for liability coverage may increase based on the amount of coverage you purchase.

The premium increase may be smaller than you’d expect. And keep this in mind: your premium with additional liability coverage is likely to cost you less than what you’d pay if you’re in an accident and not properly covered.
If you decide not to purchase additional liability coverage, you should ask yourself this: “How much can I afford to pay out of my own pocket if I'm responsible for an accident?"
Minor "fender-benders" are often covered by the liability coverage minimums set by your state. But it only takes one accident to disrupt life as you know it.

Why not further protect your family and assets by choosing higher liability coverage?

While “full coverage” isn’t a consistent, defined offering across providers, it can mean having a package of customer-selected coverages that provides you the protection that meets your needs. It can mean you have both liability and physical damage coverage, like comprehensive and collision coverage. Keep in mind there are optional coverages like rental and emergency roadside service that you also may wish to consider.

While most states require drivers to carry basic liability insurance, which offers the minimum coverage limits required by law, it’s a good idea to consider purchasing higher coverage limits than your state requires.

Why? Let’s say you were distracted while backing out of a parking space and you didn’t see a car behind you that happened to be driving by. And then you hit that car, slightly injuring the driver and her passenger.

After an investigation, you’re determined to be “at fault” for the accident. Your auto liability coverage will help pay for the damage to the car you hit as well as for the medical bills (and other costs) from the injuries sustained by the driver and the passenger, including pain and suffering, and lost wages up to your coverage limits.

If the damages you cause exceed the liability limits you have chosen, you could find yourself personally liable for all of the costs that exceed the amount your insurance policy can pay. If you’re unable to pay those costs, it could result in consequences, like garnished wages, liens against your assets and even court fees.

To fully understand the difference between minimum liability coverage and the amount of coverage you may actually need, contact a State Farm® agent.

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Related insurance coverages

Collision coverage

Comprehensive coverage

Under/Uninsured vehicle coverage

Medical payments coverage

Simple Insights®

Looking for help protecting your vehicle? You’ve come to the right place. Articles from Simple Insights draw on over 100 years of State Farm knowledge.

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Please remember that the preceding descriptions contain only a general description of available coverages and are not a statement of contract. All coverages are subject to all policy provisions and applicable endorsements. Coverage options may vary by state. To learn more about auto insurance coverage in your state, contact your State Farm agent.

State Farm Mutual Automobile Insurance Company
State Farm Indemnity Company
Bloomington, IL

State Farm County Mutual Insurance Company of Texas
Richardson, TX