How Does Liability Insurance Work?

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So what is the Auto Liability Insurance definition? Auto liability insurance is a two-fold plan that covers bodily injury and property damage and is a part of legally required auto insurance. What does Liability insurance pay for? It covers expenses from injuries to other people or property damage if you, the Asheville driver, are at fault. Learn more from our finance center about what liability insurance offers if you get into a car accident. 

What Does Liability Insurance Pay For?

Both bodily injury and property damage fall into your overall liability coverage, but each type of damage can have its own set limits. There are minimum limits set by the state, but you can choose to set your own limits based on what you need. Generally, liability insurance covers the following: 

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

But how does liability insurance work? Well, the most important factor to remember is that this coverage is for the victim of the accident, not the driver at fault. Your liability insurance will pay for the damage you do to the other person. This is why you should set limits on your liability coverage that match with what you’re capable of offering. 

Liability Coverage Limits

When a Hendersonville agent is helping you set up your plan, they’ll ask you about what you want your coverage limits to be. You’ll be able to either split your limits, or have a single limit. This is how that works: 

  • A split limit will allow you to select individual maximums for bodily injury payments per person, for all people injured, and all property damage
  • With a single limit, there is no total limit per person, the lump sum will simply be spread across all those injured and all property damaged

Apple Tree Acura Can Teach You More About Insurance Coverage

When you purchase a new or used vehicle, you have to properly go over and understand all your available financing and auto insurance options. Be sure to check your state guidelines while choosing your coverage, and find coverage that’s appropriate for you and your budget. Still have questions? Feel free to contact us online or visit our Fletcher dealership, and we’ll be happy to help.


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