How Does Liability Car Insurance Work?
Car insurance is something that every driver or vehicle owner in North Carolina should maintain. While there are many types of vehicle insurance available for purchase, most of which are optional, a few are required by North Carolina State law. They are to be maintained at all times and to at least stated minimum amounts of coverage. These include the two types of automobile liability coverage – bodily injury protection and property damage protection – plus uninsured and/or underinsured motorist’s coverage. Liability car insurance is explained below.
Liability Coverage Protects the “Other Guy”
Your liability car insurance is designed to pay claims to a third party in the event that you’re involved in a vehicle accident determined to be your fault. All vehicles driven on public roads in North Carolina are required to be covered by liability insurance of the following types:
Bodily Injury Liability Coverage in the minimum amount of $30,000 to be paid toward bodily injury damages suffered by an individual in an accident you caused. Payments may be applied toward:
- Medical bills
- Lost wages
- Pain and suffering
- Funeral expenses
- Legal expenses and lawsuit settlements
Total bodily injury coverage for all third-party victims affected in a single accident must be maintained at a minimum amount of $60,000.
Property Damage Liability Coverage in the minimum amount of $25,000 is required to be maintained for payment toward damages of third-party property caused in an accident determined to be your fault. Payments may be applied toward any damaged property, except your own, to include structures, vehicles, roadside features, such as light posts or signs, and any other damaged property. Payments may also be applied toward others’ legal expenses.
This is Basic Coverage
State-mandated liability coverage is not intended to pay any claim benefits toward your own losses, whether as a result of bodily injury or damage to your own vehicle or property. For these claim benefits you must purchase additional insurance coverage, such as collision and PIP. In addition, the minimums outlined above, typically expressed as 30/60/25, are just that – required minimums. Liability protection covers you, members of your family and anyone operating your vehicle with your permission.
Understanding that any liability dollar amounts you face in excess of these rather-modest dollar figures are still your responsibility to cover, it may be prudent to consider increasing your liability coverage amounts to something more realistic, such as 100/300/50.