What Does Liability Insurance Cover?

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Auto Liability Insurance, Definition: An insurance plan that covers an insured party against costs that result from injuries or damage to other people or property.

A two-fold insurance plan that covers bodily injury and property damage is required by law in most states. Though this can only be achieved through two separate insurance plans, they are both legally required. That way expenses from injuries to other people or damage to property in New Albany are covered if you are at fault. But what is auto liability insurance’s definition? Take a closer look at liability insurance with the Toyota of Louisville finance team, and learn answers to questions like: 

  • “what does liability insurance cover?” 
  • “how does liability insurance work?”
  • And “what does liability coverage pay for?” 

That way, you’re prepared if you should get into a car accident in your new Toyota. While you’re here, you can also learn more about GAP insurance and how it can help protect your finances in the event of an accident. 



How Does Liability Insurance Work?

Both bodily injury and property damage fall into your overall liability coverage, but each type of coverage can have its own set limit. There are minimum limits of coverage set by the law, but as long as they are higher than that minimum, you can choose your own limits based on your needs. When you have liability insurance in the Elizabethtown area, you are covered for 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

The key factor of liability insurance is that it doesn’t cover damage or injury to you or your property, it only covers damage to the victim of the accident. Be sure that you set proper limits on your liability coverage so that it aligns with your financial capabilities.

What Does Liability Insurance Pay For?

When you set up your plan with your Lexington agent, they’ll ask you about coverage limits. It’s up to what you prefer, but limits can either be split among property and bodily damage, or housed as a single limit. Here’s how that works in a bit more detail:

  • 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

Learn More About Insurance Coverage at Toyota of Louisville

We’ve explained the answers to “what does liability insurance cover?” “how does liability insurance work?” and “what does liability coverage pay for?”, but do you have other questions? Contact us at our Louisville dealership, and we’ll be happy to answer them. If you want to learn more about shopping for a new car, don’t miss our car buying tips either. 

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