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...

  • Many insurance companies offer multiple discounts if you insure several cars on your policy
  • In some cases, it is better to buy only liability car insurance
  • Having low rates will help you in the long run

To drive legally in almost every state in the United States, you must purchase liability car insurance. Each state has different minimum requirements.

In fact, to register your car, you must usually show proof of insurance and many states can verify auto insurance coverage electronically.

If you are strapped for cash, it can be tempting only to purchase liability car insurance. However, this may not be the best move if you want full financial protection if you are involved in an accident.

Looking to buy car insurance? Enter your zip code above in our FREE comparison tool today!

Table of Contents

What is car liability insurance?

Car liability insurance provides you with protection if you are involved in an auto accident and are found at fault. It includes payment for repairs to another driver’s car and also for medical treatments that may result from a crash.

However, it does not provide coverage for damage to your car or injuries that you or your passengers may experience as a result of an accident that you cause.

It is possible to purchase auto liability insurance coverage in amounts higher than the minimum amounts of coverage required.

Liability insurance is most often expressed in a series of numbers on your policy and provides information about the levels of coverage available on your plan.

For example, 10/30/20 car liability insurance describes the following levels of coverage:

  • $10,000 is payable per person injured for injuries and medical expenses
  • $30,000 is owed in total for the entire accident for injuries and medical expenses
  • $20,000 is owed for repairs to damage to property per accident

Compare Car Insurance Companies

Compare quotes from the top car insurance companies and save

 Secured with SHA-256 Encryption

Compare quotes from the top car insurance companies and save

 Secured with SHA-256 Encryption

Other Types of Auto Insurance

While liability insurance is the minimum kind of coverage you are required to carry legally, it is usually advisable to consider adding different types of coverage to your auto insurance policy if you can afford it.

In many cases, auto accidents can result in expensive repairs and if there are injuries, you will also be held liable for the expenses associated with medical treatment.

Insurance for these kinds of financial liability will help provide you with protection and prevent you from potential financial ruin if you have an accident while driving.

Here are some of the essential insurances:

  • Collision Coverage — Collision car insurance provides you with protection if your car hits anything other than another vehicle. For example, if you run a fence, guardrail or building, you will be covered for repairs if you have collision insurance.
  • Comprehensive CoverageComprehensive auto insurance covers you for any accidents that are not the result of hitting another object. For example, full insurance covers damage that is the result of hail, floods, fire or hitting an animal. 
  • Uninsured/Underinsured Motorist Coverage — Uninsured or underinsured motorist coverage provides you with insurance if you are involved in an auto accident with someone who either does not have auto insurance or does not have enough auto insurance coverage to pay for damages and repairs.
  • Gap InsuranceGap insurance is critical if you have an auto loan or are leasing your car. When your car is totaled, most auto insurance will only pay for the value of the car at the time of the loss. Gap insurance pays for the remaining loan or lease balance and frees you from this financial responsibility.

Methods to Lower Your Premium Rates

Auto insurance is not usually a reasonable prospect. However, there are ways to keep your premiums down at an affordable rate.

When comparing auto insurance quotes, make sure you are comparing the same level of coverage and the same type of coverage.

One way to lower your premiums is to choose a more considerable deductible amount. You can take the money you save on your premiums and set it aside in a separate account to use if you only have an accident.

Another method of lowering your rates is to ask for any discounts that are available.

Many insurance companies offer multiple discounts if you insure several cars on your policy.

You may also qualify for discounts if you have several different kinds of insurance with an insurance company, such as homeowners, rental and life insurance.

You can also lower your insurance by only purchasing the auto insurance you need. For example, if you drive an older car, you may not need full car insurance coverage.

In this case, if your car were declared a total loss, you would only be paid for the value of the vehicle at the time of the accident.

Choosing Carefully

When purchasing auto insurance, carefully select the amount of coverage you need and the appropriate type coverage. In some cases, it is better to buy only liability car insurance.

However, it is recommended that you at least purchase more auto liability insurance coverage than the minimum amounts required by law.

Enter your zip code below and you will receive car insurance quotes for FREE!

References:

  1. https://www.allstate.com/tools-and-resources/car-insurance/liability-car-insurance-cover.aspx
  2. https://www.thebalance.com/state-financial-responsibility-laws-2645900
  3. https://www.libertymutual.com/auto/car-insurance-coverage/collision-insurance
  4. https://www.esurance.com/info/car/uninsured-and-underinsured-coverage
  5. https://www.nationwide.com/gap-insurance.jsp
  6. https://www.allstate.com/tools-and-resources/car-insurance/ask-agent-premium-deductible-limit.aspx