Liability a a type of car insurance coverage that pays for injuries and damage you cause to others and their property if you’re at fault for a car accident. It does not cover your own injuries or damage to your own car.
Liability insurance covers other people’s medical bills, lost wages and property damage, up to your policy limits. Policy limits are the maximum dollar amounts your insurer will pay on a claim. Any costs above that limit become your personal responsibility. All states except New Hampshire require drivers to have a minimum amount of liability insurance.
What does liability insurance cover?
Liability insurance only pays for other people’s injuries and property, not yours or your cars.
How liability insurance works
Liability insurance consists of bodily injury liability (BI) and property damage liability (PD). BI pays for others’ injuries while PD pays for damage you cause to other people’s property.
Most states require a minimum amount of both, typically listed as three numbers, like 25/50/25. This represents:
- $25,000 bodily injury liability, per person.
- $50,000 bodily injury liability, per accident.
- $25,000 property damage liability, per accident.
Here’s how that works in practice: Say you cause an accident that injures two people. Person A has $20,000 in medical bills and Person B has $30,000. With 25/50/25 limits, your insurer would pay Person A’s full $20,000 but only $25,000 of Person B’s $30,000 (because of the per-person cap). Person B’s remaining $5,000 becomes your personal responsibility.
Minimum liability insurance requirements by state
Each state sets its own minimum liability insurance limits. The table below shows requirements for some of the most populous states according to the Insurance Information Institute (III). Keep in mind that minimum limits may not provide enough coverage for a serious accident.
How much liability insurance do you need?
You need enough liability insurance to cover all injuries and property damage after a crash. While you’re only legally required to carry your state’s minimum liability limits, these minimums often aren’t enough to fully protect you. According to the Insurance Information Institute, the average bodily injury claim is nearly $25,000, and the average property damage claim is about $5,313. But the cost to replace a new car could be over $50,000.
Compare liability insurance
When you shop for car insurance, compare liability coverage at different limits to see how pricing changes. The app lets you compare liability quotes, fast, side-by-side. You can adjust your bodily injury and property damage limits to find the right balance of protection and cost.
Jerry works with over 100 carriers to compare quotes in minutes, and can shop for new rates when your policy is up for renewal.
How much does liability insurance cost?
According to Jerry’s data, the average minimum liability policy costs $151 per month. Increasing your limits to 100/300/100 raises your rate, but the added protection is much more affordable than the potential expense of a lawsuit.
Minimum
75-193/mo
Offers the legal minimum liability limits, which vary by state, but are most commonly 25/50/25.
100/300/100
81-211/mo
Increases bodily injury and property liability limits for greater financial protection.
What happens if you drive without liability insurance?
Driving without liability insurance is illegal in 49 states and Washington, D.C. (New Hampshire is the only exception). Penalties vary by state but can be severe.
When you need more than liability insurance
When you’re choosing insurance, it helps to start by deciding how much protection you want for your own car. That’s where full coverage comes in, which includes collision and comprehensive. From there, you can add other protections, like medical payments or uninsured motorist coverage, depending on your needs and budget.
Liability-only vs. full coverage: What’s the difference?
The table below compares what liability-only and full coverage insurance include and when each option makes sense.
Frequently asked questions about liability insurance
- Do I need more than minimum liability insurance?
- What happens if I cause an accident without insurance?
- Does liability insurance cover rental cars?
- What if the other driver doesn’t have enough insurance?
- Is liability insurance the same as full coverage?
- Does liability insurance follow the car or the driver?
- What is split-limit liability insurance?
- Who needs liability car insurance?
Methodology
Statistics, rates and conclusions in this article are based on Jerry’s proprietary database of real-world car insurance quotes, not third-party models or estimates. As a licensed insurance broker in all 50 states, Jerry has firsthand visibility into how quotes are generated and validated, and all data is aggregated and anonymized to protect privacy.
With millions of quotes delivered each year (often multiple offers per driver), our datasets are large enough to avoid bias toward any one region, insurer or driver type. Unless otherwise indicated, quotes shown are from drivers with clean records in the last 12 months. Quotes involving accidents, violations or credit use the last 18 months to ensure a reliable sample.
