What is liability
insurance?
If you are at fault
in a car accident, liability insurance pays for the damages that you
cause to someone else. It does not pay for your own damages. There are
two kinds of liability insurance: bodily injury and property damage.
Bodily injury expenses include medical bills, rehabilitation expenses,
and lost wages. Property damage expenses include the repair or
replacement of any items belonging to another person that you damage or
destroy.
Every state except
Mississippi, New Hampshire, Tennessee and Wisconsin requires some level
of liability coverage. To find out what your state requires, you can
check with your state department of insurance, or you can refer to http://www.insure.com/auto/.
There you can find information about minimum coverage requirements,
along with links to websites maintained by each state's department of
insurance.
Who is usually
covered by automobile liability insurance?
Liability insurance
usually covers the following people:
Named
insured. This is the person or people named in the
policy, no matter what car they are driving.
Spouse.
Even if the spouse of the named insured is not named on a policy,
liability insurance almost always covers him or her, unless the couple
does not live together.
Other
relative. This refers to anyone living in the household
with the named insured who is related to the insured by blood, marriage
or adoption, usually including a legal ward or foster child.
Anyone
driving the insured vehicle with permission. Someone who
steals the car is not covered.
Which vehicles are
normally covered under an auto insurance liability policy?
Named
vehicles. An accident in a non-named vehicle is covered
only if a named insured (see above) was driving.
Added
vehicles. This includes any vehicle with which the named
insured replaces the original named vehicle, and any additional vehicle
the named insured owns during the policy period (you may be required to
notify the company of the new or different vehicle within 30 days after
you acquire it).
Temporary
vehicles. A temporary vehicle is any vehicle, including
a rental vehicle, that substitutes for an insured vehicle that is out
of use because it needs repair or service, or has been destroyed.
Copyright © 2002
Nolo
DISCLAIMER: This site
and any information contained herein is intended for informational
purposes only and should not be construed as legal advice. Seek
competent legal counsel for advice on any legal matter.
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