What does it mean if you only have liability insurance

For drivers with extremely tight budgets, liability-only car insurance can seem like the smartest option. While the potential to pinch your pennies is there, liability coverage can end up costing WAY more in the long run. So, what’s the right insurance coverage for you?

At Unruh Insurance, we’re the insurance agency that tells you the truth — even about the times when liability insurance is enough for you. We want you to know how to make the best decision for your unique situation, so here are some guidelines for when it is okay to have liability-only car insurance — and when you NEED more complete coverage.

Car Insurance Explored

Since auto insurance is a legal requirement to drive on public roads in PA, you need to have car insurance to cover any damages that may result from an accident. Liability insurance is the term for car insurance that covers the damage you’d cause to other vehicles or injuries you may incur in an accident. This coverage keeps you from getting fined or ticketed, but does nothing to protect your vehicle in a variety of different circumstances.

Learn more about the penalties for driving without insurance.

While every driver and every situation differs, these are the general cases in which liability-only coverage is enough and when you need to upgrade to a plan that includes comprehensive and collision coverage.

When It’s Okay to Have Liability-Only Coverage

• Your Car Is Inexpensive and You Own It Outright — If the blue book value on your car is so low you couldn’t trade it in if you tried, you can feel safe driving with liability-only insurance. Put those extra monthly savings toward a down payment for a better car!
• You are a Young Driver with an Inexpensive Car — Young drivers are more expensive to insure and that can make them good candidates for this car insurance coverage. This only applies if they own the car outright and it doesn’t hold much residual value.
• You Wouldn’t Repair the Car if It Was Damaged — If you know your car is on its last legs and you’re a few months away from an upgrade, you can feel safe to temporarily carry liability-only car insurance coverage. This strategy often comes into play when drivers know the car won’t pass the state inspection without paying more than the car is worth.

When You Shouldn’t Have Liability-Only Coverage

• When You Still Owe Money on the Car — Even if you are a safe driver, you still need to carry collision insurance if you owe money on your car. Whether you make a mistake and hit something or are struck by an uninsured motorist or by a hit-and-run, having liability-only car insurance in those situations will be catastrophic.
• You Couldn’t Afford to Replace the Vehicle — If your finances couldn’t take the all-at-once hit from needing to dump thousands into repairing your car, then you need to pay the added monthly premium to ensure you NEVER will. As safe as you may be, there are always hit-and-runs and uninsured drivers out there that could cause serious damage to your car.

Either way, when you’re shopping around for insurance, make sure you understand the insurance coverage you’re actually getting. It is crucial to understand your deductibles, liability limits, and full tort vs. limited tort.

Comprehensive Coverage from Unruh Insurance

If you’re still deciding on the type of insurance coverage you want, the first step should be to have a conversation with an experienced insurance agent. At Unruh Insurance, there is never a cost to talk to us to review your current insurance plans. We can make recommendations and help you understand your options going forward. As always, in addition to offering great service (before you’re even a customer), we offer competitive car insurance quotes on insurance coverage of all kinds. Contact us for your free quote today.

What is liability coverage?

Liability coverage pays for property damage and/or injuries to another person caused by an accident in which you're at fault. This coverage is required by most states to legally drive your vehicle.

Liability coverage is broken down into 2 parts: property damage and bodily injury.

• Property damage coverage pays for damage to another person's property
• Bodily injury coverage provides payment for others injured in an accident

We can help you get the coverage you need.

What does auto liability insurance include?

Liability coverage includes property damage and bodily injury coverages.

Property damage covers damage to the other party's property. This could include damage to vehicles, a yard, light pole, or other property damaged because of the accident. Other things may include:

• A rental vehicle while the other person's car is being repaired
• Diminished value, the difference between the value of the vehicle if there had never been damage and the value after repairs have been completed

Bodily injury covers injuries sustained by another person because of the accident. This can include:

• Medical bills
• Prescriptions
• Lost wages
• Pain and suffering

States may have different requirements on who can file a bodily injury claim against you.

What does liability coverage not cover for an auto accident?

Liability coverage helps cover damages you're responsible for to another party because of an accident. That means it doesn't cover damages to your property or your injuries. Your damages and injuries are protected under other coverages such as:

• Collision
• Comprehensive
• Medical payments
• Personal injury protection

How much does liability coverage cost?

The cost of liability insurance coverage as part of your auto insurance policy depends on many factors. This can include things like how much coverage you select. For example, higher coverage limits may cost more.

Do I need liability insurance?

Yes. Most states (not all) require liability insurance to legally drive your vehicle. The required limits vary by state. You will check out your state on the state information pages.

Liability insurance also helps protect you, up to your limits, by paying for covered damages and injuries in at-fault accidents. These are amounts you may have to pay out of pocket if you don't have enough liability coverage.

How much liability coverage do I need?

Liability coverage should be customized to fit your needs. It's not one-size-fits-all. Our coverage calculator can help you walk through a few questions and provide you with a recommendation.

You may also want to consider an umbrella policy which provides additional coverage for more serious accidents and lawsuits.

Please note:

The above is meant as general information and as general policy descriptions to help you understand the different types of coverages. These descriptions do not refer to any specific contract of insurance and they do not modify any definitions, exclusions or any other provision expressly stated in any contracts of insurance. We encourage you to speak to your insurance representative and to read your policy contract to fully understand your coverages.

Is liability insurance Good to have?

Should you get liability or full coverage?

What is considered liability only?

What does liability does not cover?