Jessica Sautter is a Content Writer for CarInsuranceCompanies.com with a Bachelor’s Degree from Eastern Michigan University in Elementary Education with a Major in Reading and a Minor in Mathematics.

Full Bio →

Written by

Chris Harrigan has an economic degree from Limestone College and an MBA from Clemson University. He previously managed auto insurance claims for Enterprise Rent-A-Car. Currently, he is using his business and insurance expertise to provide insurance data analysis and visualizations to enhance the user experience.

Full Bio →

Reviewed by Chris Harrigan
Former Auto Insurance Claims Manager

UPDATED: Sep 21, 2020

Advertiser Disclosure

It’s all about you. We want to help you make the right car insurance coverage choices.

Advertiser Disclosure: We strive to help you make confident insurance decisions. Car insurance comparison shopping should be easy. We partner with top car insurance companies. This doesn’t influence our content. Our opinions are our own.

Editorial Guidelines: We are a free online resource for anyone interested in learning more about auto insurance. Our goal is to be an objective, third-party resource for everything auto insurance related. We update our site regularly, and all content is reviewed by auto insurance experts.

Key takeaways...

  • An ideal car insurance policy should have sufficient coverage to protect against all of the driver’s current assets
  • The insured’s previous driving record has a significant impact on liability coverage
  • The consumer has a right to review their personal credit history and to challenge any discrepancies in the report

An effective method for choosing the best car insurance coverage involves performing a thorough evaluation of specific liability clauses from various providers. Auto liability insurance protects the driver from excessive financial responsibility in case an accident occurs.

Without sufficient coverage, a driver could end up paying thousands of dollars for medical expenses for passengers in their car or someone in another vehicle involved in the accident.

Auto liability insurance also protects the insured against property damage and accruing expensive legal fees that could lead to a significant financial loss.

Enter your zip code above for instant auto insurance options now!

Table of Contents

How Car Insurance Company Coverage Differs

Auto liability insurance rates vary according to several factors that include location, personal status, previous driving history, financial background and the type of vehicle being insured.

An ideal car insurance policy should have sufficient coverage to protect against all of the driver’s current assets.

Compare quotes from the top car insurance companies and save

 Secured with SHA-256 Encryption

Location

All states in the U.S., except New Hampshire, require drivers to carry insurance with a minimum of liability coverage. Each region has a set of regulations that govern car insurance policies.

Auto liability coverage available in Texas, for example, may be quoted differently than a policy protecting a driver living in California or New York City.

Rates are based on the risk of accidents, where a rural address may bring a lower price than one situated in a major metropolitan area.

Caps on auto liability coverage also vary by region such as in Michigan, where the maximum personal injury claim is $500,000.

Regional rates can differ by as much as $1500 for the same coverage on a specific vehicle.

Age and Driving Record

In most cases, drivers younger than 25 years old pay higher premiums for auto liability insurance. More adolescent males are often charged more as are singles rather than married couples.

The insured’s previous driving record has a significant impact on liability coverage.

Some of the tops recommended carriers such as State Farm, Allstate, and Geico will quote higher rates for anyone who has been involved in a significant accident, mainly when it involved bodily injury and substantial property damage.

Drivers who have a driving record that includes numerous traffic violations, a DUI, DWI or other arrests may need to check with their local Department of Motor Vehicles to find an auto liability carrier.

Compare Car Insurance Companies

Compare quotes from the top car insurance companies and save

 Secured with SHA-256 Encryption

Credit History

Because auto liability car insurance can cost a company thousands of dollars in claims, the top providers usually perform a credit history during the application process.

Drivers with proper credit typically receive an advantage of a reduced rate for similar coverage.

The consumer has a right to review their personal credit history and to challenge any discrepancies in the report.

Compare quotes from the top car insurance companies and save

 Secured with SHA-256 Encryption

Coverage from Top Auto Liability Insurance Carriers

The top three recommended auto liability carriers strive to provide coverage for those who are considered low to medium risk drivers.

Drivers who are considered high risk may not be eligible for coverage unless they take driver safety courses or have a change in personal status or location.

Coverage may still be available to these drivers but will be quoted at a significantly higher rate.

For comparison purposes, the following top three auto liability insurance companies provide similar coverage for a typical example of a driver between 30 — 40 years old with proper credit and a clean driving record.

Actual quotations from each company may differ depending on the home location of the driver, the car usage such as for work or pleasure and the type of automobile being insured.

Auto Liability Insurance Coverage from State Farm

State Farm’s typical coverage for auto liability falls within two basic categories: bodily injury and property damage.

Drivers and their passengers are covered for medical expenses, pain and suffering, and wages in the case of an accident.

Property damage that may include the total cost of the vehicle is also provided. State Farm’s auto liability policies also cover legal and court fees.

Head over to our State Farm car insurance review page for more detailed information on this car insurance company.

Auto Liability Insurance Coverage from Allstate

Similar to State Farm, Allstate offers a scale of coverage but uses three classifications: bodily injury for each person, physical injury per accident and property damage.

The difference is that a dollar amount limit may be established as a total payout for a crash.

Insurers can negotiate how much coverage they want and may choose 1, 2 or 3 classifications. The maximum limits and individual deductible costs are also negotiable.

We have more information on Allstate on our car insurance review page.

Compare quotes from the top car insurance companies and save

 Secured with SHA-256 Encryption

Auto Liability Insurance Coverage from Geico

Geico’s insurance terms are broken into seven categories that include bodily injury liability, medical payments and a no-fault personal injury protection clause.

Property damage liability is also part of the insurance coverage that provides for legal defense protection.

Insurers work with Geico representatives to create the best policy for their individual needs.

Want to learn more about Geico? We wrote a full review of them! Check it out!

When to Reevaluate a Policy

As a general rule, auto liability policies should be reviewed every year before the policy expiration date.

Several other circumstances should trigger an evaluation so that in the case of an accident, all of the driver’s assets will be protected.

A new policy is required after the purchase of a new car and presents an opportunity to receive several quotes from the top recommended providers. In addition, if you get married or have a change in living status should be reported to the insurance company and may affect the rate.

If you relocate, your insurance coverage may be reduced when moving to a less populated region. If you no longer use your vehicle for work, auto liability coverage rates may drop.

Drivers who receive a large inheritance or have a substantial change in financial assets during the year may want to increase their liability coverage to protect their assets.

To learn more about different auto insurance companies and the type of coverage they offer, simply enter your zip code into the FREE comparison tool below now!

References:

  1. http://www.geico.com/information/aboutinsurance/auto/determining-premiums/
  2. https://www.libertymutual.com/auto/car-insurance-rates
  3. https://www.allstate.com/tools-and-resources/car-insurance/property-damage-liability-insurance.aspx
  4. https://www.libertymutual.com/auto/car-insurance-coverage/property-damage-coverage
  5. https://www.nationwide.com/auto-liability-insurance.jsp