What Does Liability Insurance Cover?

A pair of glasses and a pen are sitting on top of an insurance document.

 

Required by law in some form in all 50 states, auto liability insurance is a two-fold plan that covers bodily injury and property damage (except Florida, which only requires property damage coverage). Though these are separate policies, they are both legally required in IL when you purchase a new or used vehicle before you get license plates for Gurnee drives.

What does liability insurance cover? What does liability coverage pay for? We get these questions from Round Lake drivers from time to time. We answer these questions and define auto liability insurance in our guide!

How Does Liability Insurance Work?

You need to purchase a minimum amount of auto insurance that covers property damage and bodily injury caused by you. Without purchasing this insurance, usually in separate policies, you can’t get license plates for your new or used vehicle in Waukegan.

Both bodily injury and property damage are part of your overall liability coverage. Each can have a set limit, such as $50,000 for property damage and $75,000 for bodily injury. Though the state sets minimum limits, you can set your limits above the state minimums.

Another consideration is that an auto lender may have additional financial requirements above what liability insurance covers. You might need comprehensive coverage for damage in any situation to make sure you can pay off the loan in the event your vehicle is totaled. However, the auto liability insurance definition is just for liability due to your actions, not the actions of other drivers.

What Does Liability Insurance Cover: Bodily Injury

  • Medical and hospital bills
  • Any long-term nursing care that may be needed
  • Funeral expenses in the event of a fatal accident
  • Rehab
  • Pain and suffering
  • Lost earnings

What Does Liability Coverage Pay For: Property Damage

  • Repair expenses
  • Necessary part replacement
  • Vehicle damage
  • General property damage (house, personal property, etc.)
  • Pets

Remember, the key factor is that this coverage is for the victim of the accident, not the driver at fault. You need to have enough coverage to pay for your vehicle’s damage and the damage to someone else’s property. That’s how liability insurance works.

What Does Liability Coverage Pay For: Liability Coverage Limits

When discussing how liability insurance works, you need to set your coverage limits at the time you pay for your policy. Limits can either be split or housed as a single limit.

Here’s how liability insurance works for limits:

  • A split limit will allow you to select individual maximums for bodily injury payments per person, for all people injured, and for all property damage.
  • With a single limit, there’s no total limit per person, the lump sum will simply be spread across all those injured and all property that’s damaged, per the auto liability insurance definition in your policy.

Learn More About How Liability Insurance Works at City Chevrolet Of Grayslake

How does liability insurance work for your automobile purchase? Contact us, call (847) 752-6223, or visit us in Grayslake if you have more questions. We’re happy to answer them! Meanwhile, you can see how much money you could save on your purchase with our new vehicle specials.

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