How Does Liability Insurance Work?

Tiny car with insurance documents

Auto liability insurance is required by law in most states, including Texas. It’s a two-fold plan designed to cover both bodily injuries and property damage to cover expenses that you, the driver, may be at fault for. There are a lot of components to the auto liability insurance definition, but the finance team at Oviedo Chrysler Dodge Jeep Ram FIAT is here to break it down for you so you can be as informed as possible. But, how does liability insurance work and what does liability coverage pay for? Let’s take a look and find out!

What Does Liability Coverage Pay For?

What does liability coverage pay for? As stated above, the two components of liability insurance are bodily injury and property damage. These each have their own set limits–the state sets minimum limits, but you can also set your own limits based on what you’re comfortable with. Here’s everything that liability insurance covers for Giddings drivers:

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

Property Damage

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

Liability insurance coverage is designed with the victim of the accident in mind, not the driver at fault. Be sure to keep in mind your budget and how much you can offer when setting limits for your liability coverage.

Liability Coverage Limits

Setting up limits is relatively straightforward–they can be split, or housed as a single limit. Your Smithville agent will be able to help you set up your plan and set reasonable coverage limits. Here’s how it works:

  • If you choose a split limit, you can select individual maximums for bodily injury payments per person, for all people injured, and all property damage.
  • If you choose a single limit, there is no total limit per person. Instead, the lump sum will be spread across all those injured and all property damaged.

Learn More About Insurance Coverage at Oviedo Chrysler Dodge Jeep Ram FIAT

If you have any questions about liability insurance coverage, or want to learn more about the various forms of car insurance available to Smithville drivers, feel free to contact our office! You can also stop by our dealership to talk to a finance expert in person. We’re committed to making the process of financing and insuring as smooth and convenient as possible for you. We hope to see you soon!


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