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Liability (Bodily Injury)
Anyone who drives a car knows that auto insurance is an unavoidable cost of driving. It can be very expensive, or relatively painless, depending upon the kinds of coverage you choose, and rates your driving record makes you eligible for. While different states require different types of coverage, one type of coverage is universally required: liability coverage (also known as bodily injury).
Liability coverage is insurance that pays for harm to others involved in an accident for which you are found to be at fault. This harm includes harm to the person of another driver or passenger in another car, and damage to the property of the others involved in the accident. When you are at fault in an auto accident, your insurance company pays the damages. If you do not have insurance, the other driver(s) may sue to recover damages. In some states you are required to pay the cost automatically. Having the proper insurance can actually save you money if you are at fault in an accident.
Coverage levels are determined by limits you select. You can choose anywhere between a $50,000 limit and up to as high as a $1 million limit. This limit represents the maximum amount the insurance company will pay for damage caused by a single incident. It depends on what your insurance company offers, as well as how large a premium you are comfortable paying. The higher the limit, the more you will have to pay as a premium. However, $100,000 to $150,000 is the accepted norm for a pay out limit on a liability insurance policy.
The premium is the amount of money you pay periodically to keep your insurance coverage. It is possible to lower your overall premium by doing a few things. You can set lower limits on your other coverage, as well as set higher deductibles. Some companies offer discounts for more than one car on the policy. If you purchase policies for other types of insurance, like home or renters insurance, you can also receive a discount on your premium.
The importance of having liability coverage on your car cannot be overstated. Not only can it save you money in the long wrong, it can also spare you hefty fines and other unpleasant consequences. In some states, you can receive a good number of points against your driver's license, and in others, it can be a cause for the complete revocation of your license. Many states require that you show proof of insurance before they will allow you to even register your car.
There is no way to avoid getting car insurance, at least liability coverage, and still be a law-abiding citizen. Not only is it the law, but it is also a matter of personal accountability for your actions while driving a car. If you cause an accident, you are responsible to pay for the damage. Having adequate liability coverage can help you more inexpensively discharge your responsibility.