Whether you’ve been driving for 40 years or it’s your first time behind the wheel, one thing is certain—accidents can happen. That’s why virtually every state mandates vehicle owners and drivers to carry some type of car insurance.
While the type and amount of insurance you’re required to carry can vary from state to state, most require you to purchase coverage for damage you cause to others in an accident you’re deemed fully, or partially, at fault for. This type of coverage is known as liability insurance.
Because most accidents involve two or more drivers, drivers often share responsibility. Carrying liability insurance protects you from paying out large sums of money if the accident you’ve been involved in causes major vehicle damage or injuries to one or more drivers.
Before you sign on to an auto insurance plan, it’s important to know the following:
- The different terms associated with liability insurance
- Your state’s coverage requirements
- What your existing or proposed insurance plan covers and your additional options
Liability insurance coverages
Although your insurance provider can advise you on your state’s insurance mandates, it’s important for you to fully understand the terms to determine whether you want to purchase additional coverage beyond the requirements. Liability insurance plans can include the following coverages:
- Bodily injury: Injury to another person for which you’ve been deemed fully or partially at fault. It’s important to remember that accidents can result in injuries to passengers and bystanders as well.
- Property damage: Damage to cars and property of others for which you have been deemed fully or partially at fault.
In the state of Texas, you are required to carry minimum auto insurance limits of $30,000 per person /$60,000 per accident /$25,000 property damage.
State-mandated coverage options
In addition to standard liability coverages, many states require that drivers are offered the option to purchase additional coverage types—many of which are injury-related. These options make financial sense if you would have difficulty paying for major medical expenses. The standard options are:
- Uninsured motorist bodily injury: Injury to you or others in your car for which an uninsured driver is responsible.
- Underinsured motorist bodily injury: Injury to you or others in your car for which the at-fault driver does not carry sufficient protection to compensate the injured party.
- Medical payments: Expenses for medical treatment for injuries to you or others in your car, regardless of who is at fault for the accident. In your state, this may be offered in lieu of personal injury protection.
- Personal injury protection Includes medical and other expenses incurred by you or others in your vehicle as a result of an injury caused by a car accident. In your state, this may be offered in lieu of medical payments.
Additional coverage options
While states don’t require you to hold the following coverages—and don’t require insurance providers to offer them—you may choose to stay protected with optional coverage, including:
- Collision: Accidental damage to your vehicle as a result of striking another car/object or being struck by another car.
- Comprehensive: Accidental damage to your car is not caused by a collision. Examples include damage caused by striking—or being struck by—an animal, weather-related damage (think of wind, storms, hail, etc.), as well as vandalism or theft.
- Rental: Coverage for the cost of a rental vehicle to use while your vehicle is out of commission due to an accident.
- Roadside assistance: Expenses for emergency roadside assistance with your vehicle, including towing, lock-out, battery service, low fuel, and flat tire assistance.
With so many requirements and options, choosing an insurance plan can feel overwhelming. Knowing your state’s insurance requirements, what different coverage terms mean, and how you’ll be protected can help you choose a plan—and get behind the wheel—with more confidence.