When it comes to car insurance, there are two types of liability insurance. Liability insurance refers to bodily injury and/or death and it also refers to property damage. The definition of liability for property damage in car insurance is pretty broad.
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Any material object can qualify as property, so just about any item that gets damaged in an accident can be submitted for an insurance claim, from a car to a fence to a house. Liability means it is your responsibility to pay for the damage.
Car Insurance Liability for Property Damage in an Accident
State law requires everyone to carry liability insurance for both bodily injury and property damage. To minimize law suits and to ensure victims of car accidents can be properly compensated, all of the states mandate that some amount of liability insurance or other proof of financial responsibility must be obtained in order to legally drive a motor vehicle.
If you are liable for something, it means you are responsible for it.
So, if you are involved in a car accident and if the car accident is your fault then you are liable to pay for all of the damages resulting from that accident. Property damage can include all sorts of property, including someone’s home.
So, whether you hit another car or you run into someone’s fence, your car insurance liability will cover those damages.
Liability insurance is insurance you purchase to help you pay for liability damages. For a set premium, you purchase a set amount of liability coverage from a car insurance company. If you are in an accident for which you are responsible, the insurance company will pay for the other parties’ bodily injuries and property damage up to the amount of coverage you purchased.
If the damages from the accident exceed the coverage limitations of liability car insurance then you are responsible for paying the difference.
It is usually recommended to carry more than the minimum state required coverage amounts to be sure you have sufficient coverage to cover the costs of an accident. Experts recommend liability coverage of 100/300/100 which exceeds all state minimums.
Collision Insurance for Property Damage in an Accident
If you are at fault for an accident and you have liability coverage, then your car insurance policy will cover the other person’s property damages. However, if the accident is your fault and you have liability insurance, your car insurance company will not reimburse you for any damages to your own property; you will have to pay for these damages out of your own pocket.
In order to have your own car covered by insurance for an accident, you need to buy collision insurance.
Collision insurance will pay you for damages to your property in an accident regardless of who is at fault. If you have both liability and collision insurance and you cause an accident, then your property and the other party’s property will be covered up to the limitations set forth in your policy.
Property Damage not Covered by Liability
There are times when you may experience property damage that is not the result of an accident. In these incidents, liability insurance is not applicable.
For example, if your car gets damaged in a shopping mall parking lot by a shopping cart or some kids key your car as they walk by it parked outside of your home, liability insurance will not pay for your property damages.
If you find out who caused the damage, then you may be able to legally pursue that party to pay for damages through their liability insurance, but these types of situations usually go unpunished. Therefore, it is a good idea to buy comprehensive car insurance to pay for any property damages that occur to your car that are not accident-related.
Comprehensive Car Insurance Explained
With comprehensive car insurance, almost any non-accident property damage that occurs to your car will be covered by your car insurance. This includes the majority of incidents that are non-collision related, including fire or theft.
Most often, comprehensive insurance is sold as a package deal with collision insurance, but sometimes it can be purchased separately as well.
Unrelated to the deductible on your liability policy, you can have a different deductible amount for the collision and/or comprehensive portion of your policy. For example, you may have a $250 deductible on your liability coverage but a $500 deductible on your collision or comprehensive insurance.
The higher that your insurance deductible is, the lower your premium will be, so raising your deductible can help you save money on your car insurance rates.
Just be sure to have enough money for the higher deductible put aside in case you need it in an emergency.
You have to carry liability coverage, and adding collision and comprehensive car insurance to your insurance policy gives you total car insurance protection.
Whether you are at fault for an accident and have to pay for someone else’s property damage, or someone else damages your property unbeknownst to you, by having total car insurance you can greatly minimize your own out-of-pocket costs.
What insurance company offers the best property and casualty insurance?
This is a tough question to answer because some of what makes an insurance company considered “good” to an individual is entirely subjective. However, you can find a list of the top rated insurance companies by consumers on JDPower.com.
You can also do further research on these companies by visiting the Better Business Bureau’s website or by going online and reading user forums as well.
There are many things you need to consider when choosing an insurance company. For example, a good financial rating is important as this helps to determine a company’s ability to pay its claims. You can use companies like A.M. Best to check the financial rating of virtually any car insurance company.
These financial sites also offer a prediction regarding the future ratings for the company based on the financial trends of the company and of the insurance industry as a whole.
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