“How Much Property Damage Coverage Should I Have?” is a common question especially for new drivers and also for those who purchase their own auto coverage or move to a new state after relying on a parent’s policy. If you cause an accident, let us tell you that the property damage liability covers the other vehicles involved and related property damages, while bodily injury liability pays for the medical expenses of others in your at-fault accidents.
Provisions of Property Damage Coverage
You can’t use your property damage liability policy to cover damages for your vehicle or home. Depending on the incident, you might need either a comprehensive or collision insurance plan to save yourself from paying out of pocket.
If you have an accident and the police officers at the scene determine that it is your fault, then they will claim against your liability policy for repairs to their car. This is called a third-party claim, and while this does not often happen, if the cost of repair exceeds what insurance covers or if there are excessive damages caused by accidents such as hail damage or vandalism where the bodily injury occurred on top of property damage; in these cases, you could be liable for paying out more than just what’s covered by liability policies.
Minimum Property Damage by State
It’s undeniable that being able to get back on the road quickly after a car accident is essential. States have different auto insurance liability coverage requirements, but NerdWallet reports they all require property damage coverages of some kind to protect you financially and legally.
States requires the following minimums:
- $5000 – California, Pennsylvania, Massachusetts, New Jersey,
- $10,000 – Arizona, Delaware, New Mexico, New York, Vermont, Washington, Washington DC, Florida, Hawaii, Michigan, Minnesota, Wisconsin
- $15,000 – Colorado, Iowa, Maryland, Tennessee, Idaho, Utah
- $20,000 – Illinois, Montana, Virginia, Wyoming, Nevada, Oregon
- $25,000 – Alabama, Alaska, Georgia, Arkansas, Connecticut,
- Indiana, Kansas, Kentucky, Louisiana, North Carolina, North Dakota, Ohio, Oklahoma, Rhode Island, Maine, Mississippi, Missouri, Nebraska, New Hampshire, South Carolina, South Dakota, Texas, West Virginia
In most of the states, you are needed to purchase additional coverage beyond property damage liability, but New Hampshire does not require drivers to have any liability insurance. Additionally, you can pay $500 to waive liability insurance in Virginia.
If you don’t want to go through the hassle of getting a bond or depositing funds in an escrow account, most drivers choose to buy the insurance and cover their costs.
Now that you have answered the question of how much property damage insurance you need, now is the time to shop around and find the best rates for auto liability coverage in your area. You will pay less for auto insurance if you live in a rural area, have a clean driving record, and have a good credit rating with many years of experience as an insured driver under her belt. Understand these factors well enough so that when shopping around, get quotes from different insurers!