One of the most basic car insurance coverage is liability insurance. There are two types of liability insurance.
One covers the people who get hurt or killed because of the accident and the other deals with the property that you may have damaged because of the accident. The latter is called property damage liability car insurance.
As the name implies, property damage liability car insurance ensures that any damage to property that you may have caused will be paid off by the insurance company. What is covered under “property”? Of course, the other person’s car or vehicle is the foremost concern. However, other property such as a fence, or even a mailbox will be covered by property damage liability insurance.
You may think that that being the careful driver that you are, you probably wouldn’t need such an insurance coverage. That may be true. However, you would certainly wish that you had taken out this cover if you get into an accident and damage an S-class Mercedes Benz! More than protecting you financially by paying off damages to property, this car insurance coverage also gives you a legal defense in case the other party files a lawsuit against you.
Different states have different requirements as to the minimum amount you can take out for property damage liability car insurance. Similar to bodily injury liability insurance, this type of coverage has a split limit. So in determining what limits you ought to take, first note what the state’s minimum is. Then determine your assets – which you want to protect in case of an accident. You would also want to take into consideration the worth of the cars on the road today. More than that, if other members of your household drive, you should consider their ages and driving habits as well. Another thing to consider in determining property damage liability limits would be your chances of getting involved in a lawsuit. Some professions which are deemed to be high paying in the eyes of the public are more prone to lawsuits than others. In this case, you might want to set higher limits for your property damage liability car insurance.
The bottom line in setting your liability limits is the value of your assets which will be put on the line. If you do not have too many assets at risk, then you can perhaps settle for the lower bracket limit. Otherwise, it would be wiser to go for the higher bracket in order to protect you in the future.