What Is Bodily Injury Liability Coverage And How Does It Work?

If you damage someone else in an at-fault collision, bodily injury coverage will pay out and can safeguard your assets if you are sued.

If you harm someone in a vehicle accident, bodily injury coverage assists with covering their medical expenses. It may also pay for their lost income if they cannot work due to the collision.

Although this coverage does not cover your personal medical expenditures, it does cover the medical expenses of most other persons involved in the accident, including

•Other motorists and passengers.

•Pedestrians.

•Passengers in your own automobile who are not related to you./h5>

This coverage is critical for a variety of reasons, and it is legally mandated in the majority of states. If you have adequate insurance, it can also cover legal fees from a lawsuit if you damage someone in a car accident.

Remember that this policy does not cover any repairs or property damage, whether to your car or the other driver's. In reality, physical injury insurance will not pay for any of your immediate needs. Unless you have supplementary coverage, you will be responsible for any auto repairs, as well as your own medical expenditures and missed income.

What Is Covered Under Bodily Injury Liability?

Bodily injury liability insurance can compensate for someone else's:

•Emergency treatment, hospital costs, follow-up appointments, and medical equipment such as crutches are all examples of medical expenses.

•Income lost if they are unable to work as a result of the injury.

•Funeral expenses if the accident results in death.

•Suffering and anguish, if the wounded driver or passengers suffer from long-term emotional stress or discomfort.

If the injured person decides to sue you, this coverage may also pay your legal bills and legal counsel.

Limits On Bodily Harm Liability Coverage

When you get bodily injury insurance, you'll notice two figures that represent your coverage limits, such as "100/300." These figures represent a limit per person and per accident, respectively.

Per-Person Restriction

The per-person limit is the amount of money your insurance would pay for each person injured in an accident caused by you.

Limit Per Accident

The per-accident limit is the most your insurance company will pay out per accident in which you are at fault.

Assume you purchase an insurance with bodily injury limits of 100/300. You then cause an accident, resulting in the following medical bills for the three occupants in the other car:

Michael: $30,000, Anne: $40,000 and Chris: $110,000

Total costs: $180,000*

Based on the National Safety Council's average cost of motor vehicle injuries.

Here's how to evaluate your insurance coverage and calculate how much you'll have to spend out of pocket:

Per Person Bodily Injury Limit- The first number, 100, is your per-person bodily injury payment limit. Your coverage will not pay for any single person's injuries in excess of this amount. In this situation, both Michael and Anne's medical bills are less than $100,000, thus your insurance will pay the full amount. However, because Chris' medical bills exceed $100,000, you will be responsible for the remainder of his charges, in this case, $10,000.

Limit Of Bodily Harm Per Accident- The second figure, 300, is your per-accident limit, or the most your insurance will pay for all injuries in a single accident. This figure remains constant regardless of how many individuals are harmed in an accident. The entire medical expenditures, in this case, were $180,000, as seen above. Because your policy covers $300,000 per accident, it may appear that your insurance will pay the full accident. However, your bodily injury limit per person remains in effect. Even though these charges will not surpass the per-accident limit, you are still above Chris's per-person limit.

How much money do you owe? You'll have to pay a total of $10,000 out of pocket for this accident.

Do You Require Bodily Harm Liability Insurance?

Yes, you almost certainly require bodily injury liability coverage to lawfully drive anyplace in the United States, with the exception of areas of Alaska, New Hampshire, New Jersey, and Virginia

However, in order to be excused from coverage in some states, you must fulfill specific standards. In Alaska, for example, you can opt-out of automobile insurance only if you reside in a rural location. In the meanwhile, Virginia citizens who choose to opt-out must pay $500 to the state's Department of Motor Vehicles.

Although bodily injury coverage is not required in New Jersey, you must have property damage liability and personal injury protection in order to drive lawfully. Property damage responsibility covers harm you inflict on another vehicle or property in an at-fault collision, whereas personal injury protection covers medical expenditures regardless of culpability.

How Much Physical Injury Protection Do You Require?

You should receive the minimum quantity necessary to drive lawfully in your state. According to several experts, bodily injury limitations should be at least $100,000/$300,000. However, you may wish to get higher-limit insurance to cover any financial assets that may be confiscated in a lawsuit. In general, you should get enough coverage to cover your net worth.

If you don't have adequate liability coverage to cover an at-fault collision, you'll be liable for the other person's injuries. Insufficient restrictions may cause the other party to sue you, putting your funds, home, and other assets in danger.

Many car insurance companies will not sell bodily injury liability coverage in excess of $500,000. Consider purchasing umbrella insurance if your insurer does not provide a policy with high enough coverage to protect your net worth. If you've exhausted your liability insurance limitations, umbrella coverage can help.