What Is Property Damage Liability Coverage And How Is It Structured In Car Insurance?


What is Property Damage Liability Coverage?

Property Damage Liability coverage is a type of Car insurance coverage that provides financial backup to accidents cases you are at fault. This means when you are found legally guilty or responsible for a car accident, the property damage liability coverage in your insurance policy will help pay for the costs of repairing or replacing another person’s property you spoilt. This typically does not mean damage to someone else’s car but also apply to any other type of property you damage in an accident like fence, house, goods, etc. So if there is any sad event of accident when you have a car insurance policy, all you need to do is file an auto insurance claim to your insurer and every other thing will be taken care of.

Related: Are you tagged as high risk driver? read this.

How is Property Damage Liability Structured?

The property damage liability limit in auto insurance is a dollar amount that represents the maximum amount of property damage your insurance policy will cover for you. So if you have a $50,000 coverage limit, it your policy can only cover up to this amount and you would be responsible for covering the cost of every other expenses remaining. The higher the premium, the higher the property damage liability limit you are given.
Related: How to lower your car insurance rate

How Much Property Damage Car Insurance do i Need?

While the Insurance Research Council found out that the average property damage liability claim was just over $3,000 in 2012, you can easily exceed the minimum required coverage if you damage or total a new, expensive car in an accident. currently, The average new car costs over $30,000 today, according to TrueCar.com. The other party may sue you for the difference if the damages exceed your limit, putting your savings and assets at risk. So we recommend you buy maximum property damage coverage that you can afford to avoid this risk.

Since most states in the United states requires drivers to carry a minimum amount of bodily injury and property damage liability insurance. The map below shows prices of minimum coverage limit per accident in the United States.

Source: WalletHub

Benefits of Additional Property Damage Liability Coverage

A minimum amount of property damage liability coverage is likely not going to be enough to cover you for the total amount of damages you may be responsible for paying in a car accident. So buying a higher limit of property injury liability insurance will further give you as boost and protect your assets and future earnings against the risk of a large financial loss in accident cases.
Also, Liberty Mutual can show you the level of property damage liability coverage that best suits your unique situation when you start a free quote with your car insurance provider.

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