What Does Liability Insurance Cover?

Insurance Agent Examining Car After Accident

Most states require liability insurance under law, but just what is liability insurance and what does liability insurance cover? Auto liability insurance definition states that it must cover both bodily injury and property damage. So this covers both injuries and damage that the driver has caused. Take a deeper dive into what this means for you with help from our finance experts, and get more car buying tips from City Cadillac.

How Does Liability Insurance Work?

So, how does liability insurance work? The state puts certain minimum limits in place, but you can also raise those limits depending on your preferences. Remember that this type of insurance covers accidents to which you are at fault, so be sure to consider that when setting your limits. What does liability insurance pay for?

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 Coverage Limits

A driver in Great Neck may have different needs than a driver in Brooklyn, so you can adjust your coverage limits as you’d like. You’ll have the choice of splitting your limits or housing them as a single unit. What does this mean for you?

  • If you opt for a split limit, you can select the individual maximums for both bodily injury payments per individual, for all people injured, and all property damage.
  • If you opt for a single limit, there’s no limit per person. Instead, the lump sum is distributed across all of the injured and all of the property damaged.

Which is right for you? Our finance team would love to run you through the different options to help you make the best decision possible.

Find Out More with City Cadillac

When you purchase a new or used car at City Cadillac, our team will make sure that you have all the information that you need every step of the way. Contact us with any questions or feel free to stop by our dealership in Long Island City to chat in person.


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