Auto Liability Insurance in Texas
Auto liability insurance coverage in Texas protects a person’s finances when they are liable for the damages (property and bodily) caused in an accident. For instance, auto liability will cover the medical bills of the vehicle’s occupants, their recovery treatment expenses, repair of their car, and lost wages. Auto liability protects the insured up to the Texas-state liability limit of:
Bodily injury:
- $30,000 bodily injury liability limit per person.
- $60,000 bodily injury liability limit per accident.
Property damage:
- $25,000 property damage liability limit per accident.
Auto liability insurance coverage is a state requirement, and failure to have it attracts penalties. For instance, if you are not carrying up to the state required limit of 30/60/25, you will be fined up to $1,000, your driver's license and motor vehicle registration will also be suspended. In addition, your car may be impounded for up to 180 days at the cost of at least $15 per day. An insured can have more than the state coverage limit, but they cannot have less. Note that in the event of an at-fault accident where the liability incurred is more than the coverage limit, the insured will need to pay out of pocket to settle the rest of the bills. As such, it is advisable to purchase more than the state minimum requirement to protect you from paying out of pocket for a covered loss.
Usually, you can rely on resources provided by a state-licensed insurance agent to answer what exactly is an auto liability in Texas. However, you can also conduct your research by asking the following questions:
What is Considered Auto Liability Insurance?
In Texas, auto liability insurance is a plan that protects the insured financially by paying to repair property damages or bodily injury while in an at-fault car accident. Auto liability is a state minimum requirement that every Texan driver must have to drive within the state legally. Auto liability provides coverage to other people, not only the policyholder.
To prove that they have auto liability coverage and the required financial responsibility, drivers must be able to show a Texas Liability Insurance Card. The liability card is proof of carrying at least the legal minimum requirement and provides information on the insured and their insurance provider. If there is an at-fault accident, the insured will be required to provide their liability insurance card as proof of carrying the necessary legal liability amount.
What is the Purpose of Auto Liability Insurance?
The primary purpose of auto liability insurance in Texas is to financially protect an insured person when they are at fault in a car accident that causes bodily injury and property damage to others. Without the auto liability, the insured will have to pay out of pocket for any liability incurred. So when the insured collides with another vehicle and causes damage to the car, their auto liability insurance covers it. The accident could be anything from barely denting the vehicle to significantly injuring drivers and passengers.
What is Auto Liability Insurance for?
Auto liability insurance is used to repair or replace property that Texan drivers cause damage to in an at-fault accident. This means when you run into another individual’s vehicle, auto liability will be responsible for paying for the damages. Also, auto liability covers medical bills of the vehicle’s occupants. For instance, auto liability coverage pays the medical bills incurred from the hospital visit if any car occupants have a concussion due to the crash for which you are at fault. Auto liability will cover payment of their recovery treatment expenses and lost wages due to them being unable to work. An at-fault accident may sometimes lead to the death of the occupants of the car you crashed into. Auto liability insurance in Texas will also cover the funeral costs of such deceased occupants.
What are the Types of Auto Liability Insurance?
Liability coverage protects you by paying for damages or medical expenses of others for an accident you are legally at fault. There are two kinds of liability that your auto liability insurance plan must cover, which is the bodily injury liability and property damage liability:
Bodily injury covers the medical expenses of other motorists who sustained an injury in an accident caused by you.
Property damage covers the repairs or replacement of a car and other properties like fences and mailboxes after an at-fault accident.
As you know, the minimum limits available for your auto liability coverage are $30,000 for bodily injury per person, $60,000 for bodily injury per accident, and $25,000 for property damage. Note that these limits are the maximum your insurance carrier will pay to these other persons. If the liability incurred exceeds this limit, you will have to pay out of pocket for the remaining costs. Considering you do not want to pay out of pocket, it is advisable to purchase more than state minimum liability so that your insurance provider can bear the liability fully.
Speak with an agent licensed to offer insurance services in Texas, to know more about your liability limit options.
Do you Need Auto Liability Insurance in Texas?
Yes. First, the state law mandates you to have auto liability to drive your car. You have to purchase coverage of at least $30,000 in liability coverage for each injured person, up to a total of $60,000 per accident and $25,000 for property damage per accident. Also, auto liability insurance protects from paying out of pocket for an accident that causes property damage and bodily injury. So if you intend to drive in Texas legally, you must purchase auto liability. You can contact a state-licensed agent to help you go through your options with auto liability.
Why Do you Need Auto Liability Insurance?
Texas requires you to purchase the state minimum auto liability insurance coverage when you buy a car before putting your car on the road. Auto liability also provides the following benefits:
Drivers need auto liability insurance to prove their financial responsibility.
Auto liability insurance can save you from the financial burden you may face when you cause an accident that causes property damage and bodily injury. Apart from not losing your driver’s license, you also do not have to pay for the repairs, replacements, and medical bills out of your own pockets.
How Much Auto Liability Insurance Do you Need?
Looking at your finances, how much coverage you need depends on you. However, auto liability has three primary minimum liability limits in Texas, which is the highest claim your insurance provider will pay for a covered accident that is your fault. This limit is typically called split limits, displayed as 30/60/25; it is Texas required minimum coverage. When you purchase an auto liability coverage, it will look like this:
$30,000 bodily injury (BI) liability limit per person per accident. This is the maximum an insurance provider will pay for a single person after an at-fault-covered accident.
$60,000 bodily injury liability limit per accident. This is the maximum an insurance provider pays for injuries to every person who sustained a bodily injury in an at-fault accident.
$25,000 property damage (PD) liability limit per accident. This is the maximum an insurance provider pays for property damage caused by an insured in an at-fault accident, including damages to buildings, fences, poles, and the vehicle.
It is important to note that these limits are the minimum you can purchase in Texas, but they are usually not enough to cover all liability in most cases. Purchasing only the state minimum auto liability coverage may not provide complete coverage when the accident caused more damage than the minimum liability can cover. This means you may have to take care of the rest out of pocket. It is advisable to purchase more than the minimum limit auto liability to ensure your finances do not get strained after an accident and you do not risk being sued.
The most common liability limits purchased by Texans are: $300,000/$500,000/$100,000. That is BI: $300,000 per person, $500,000 (total combined) per accident, and PD: $100,000 per accident. This is usually considered enough coverage for a multi-vehicle collision.
Consult with a state-licensed insurance agent to discuss the amount of coverage that will be suitable for your needs, vehicles, and budget.
What Auto Liability Insurance Coverage Do you Need?
You need auto liability coverage for bodily injury and property damage to protect other people in an accident caused by you. Because it is a state-required liability, you must purchase automobile liability insurance. However, you can purchase more than the minimum liability limit. The amount of liability coverage you need should be customized to fit your needs. In addition to auto liability, you may want to consider a full auto insurance coverage or umbrella policy for automobile insurance to provide you additional coverage.
Speak with a state-licensed insurance professional to discuss the state auto liability coverage limits and how to purchase more liability that fits your finances and needs.
Is Auto Liability Insurance Required by Law in Texas?
Yes. Texas Motor Vehicle Safety Responsibility Act requires all Texan drivers to have minimum auto liability insurance. Any driver that operates their motor vehicle without proof of auto liability coverage commits a misdemeanor punishable by a fine of about $175 to $350 if it is a first-time offense. For subsequent infractions, the defaulter will be fined between $350 to $1,000. Apart from being fined, defaulting drivers will have their driver’s license or vehicle registration suspended by the Texas Department of Motor Vehicles (DMV). Failure may lead to suspension or revocation of your driver’s license.
How Does Auto Liability Insurance Work?
As an at-fault state, an auto liability insurance plan works to pay for the property damage and bodily injuries incurred by another in an accident caused by you. This means when you are at fault, your insurance company will cover the expenses of repairing or replacing property damages and paying for the medical costs incurred by other parties up to the limits you have on your policy. To understand how auto liability works in Texas, you need to ask the following questions:
What Does Auto Liability Insurance Cover?
Auto liability insurance in Texas protects the insured when they are at fault in a covered accident. It will pay for damages and injuries you cause to the occupants of another car, along with some associated costs, including:
Damage to other individual cars
Damage to properties other than vehicles like mailbox, fence, house, and street sign
Injuries to the occupants (drivers and passengers) of the other vehicle and pedestrians
Loss of Income
Legal fees (if a legal action ensues)
What is Auto Liability Insurance Good for?
Auto liability insurance is good for protecting the public from damages and bodily injuries you may cause as a driver, by repairing or replacing the damaged property of other people and covering their medical bills. The insured benefits from having this coverage by not having to pay for the costs associated with the damages out of pocket. Everybody wins.
Here are some ways to show what auto liability is good for, if purchased at the Texas state-required liability minimums:
Bodily injury: 30,000 max. per person, with a cap of $60,000 per accident
Property damage: $25,000 per accident
Auto liability Bodily Injury (BI) protects the insured in an at-fault-covered accident that causes the driver and/or passengers in the other car Bodily Injury. So let's say the:
The driver of the “other” car has medical bills of $20,000
Passenger A has medical bills of $25,000
Passenger B has a medical bill of $10,000
The at-fault driver's auto liability insurance covers each person involved. The total for medical bills for all the injured persons is $55,000, which is less than the purchased combined limit cap of $60,000 for Bodily Injury, required under the Texas state law.
If the medical bills exceed the purchased liability limit, the insured becomes liable for the overage out-of-pocket.
Auto liability also covers Property Damage. For instance, if you crash into another car and cause damage to the vehicle or any other object you hit during this event, up to $25,000, your insurance provider will cover all the resulting bills because the damage is within the purchased coverage limits for Property Damage (30/60/25) $25,000 per accident.
Property Damage: It does not take much force and the accident does not necessarily need to involve multiple vehicles, to cause over $25,000 in damage to an average vehicle on the road. In 2022, the average price of a new car in Texas was over $47,000.
To get a professional opinion, consult only with state-licensed insurance agents.
What Does Auto Insurance Insurance Typically Include?
Auto liability insurance includes coverage for bodily injury suffered by another driver and their passengers (if any) in an at-fault car accident by the insured. It also provides coverage for property damage caused to another person in a covered accident caused by you. The claim may include compensation for lost income, due to the accident.
You may want to consult with a state-licensed insurance agent for more information on auto liability coverage, especially what it covers and what to expect when it protects you.
Who is Covered by Auto Liability Insurance?
Auto liability insurance covers the policyholder by paying for property damage repairs and taking care of medical bills incurred for treating injury caused by the insured to another in an at-fault accident. It only covers liability incurred by another party; it does not cover the policyholder.
For instance, if you crash into a vehicle, breaking your own arm, busting the windshield of the other car, and dislocating the victim-driver's arm, your auto liability insurance will replace the windshield and take care of the medical expenses in getting the other driver’s arm checked and treated. Your broken arm and damaged car are not covered by your auto liability insurance.
What Types of Items Does Auto Liability Insurance Cover?
Auto liability coverage covers injury caused to another person and repairs or replaces properties damaged in an at-fault car crash.
When you strike another vehicle, it may be a jarring experience, regardless of the cause. You might have caused damage to people and/or their property (which is covered by your liability insurance) and yourself (which is not covered by your auto liability insurance. You need Comprehensive and Collision coverages for that).
With a properly structured auto liability policy you do not need to be scared of how much it will cost to take care of the injuries caused by you. The bodily injury liability coverage takes care of the driver and the other occupant as long as their medical bills and lost income claims do not exceed the limits of your coverage.
Now that the insurance has taken care of the injured driver(s) and other occupant’s medical costs; the insurer also covers the damage to their vehicle(s) - up to the limit of your coverage. Auto liability insurance provides coverage for personal items and properties like cars, building structures, fences, mailboxes, and poles of other people.
Does Auto Liability Insurance Cover Theft?
Auto liability insurance does not cover theft, nor does it provide coverage for another party’s car theft. If an insured wants coverage for car theft, they should consider additional coverage by purchasing a comprehensive auto insurance policy. In addition, auto liability insurance does not cover a mechanical breakdown of the insured’s car; neither does it provide coverage for another person’s vehicle mechanical breakdown.
Does Auto Liability Insurance Cover my Passengers?
Yes, passengers in your vehicle will be covered by your auto liability insurance if you caused the accident. Typically, Texas liability insurance of the offending driver covers bodily injury to or death of passengers in both vehicles as well as injuries to the victim-driver.
Does Auto Liability Insurance Cover Contents of a Trunk?
If you are at-fault in causing an accident with another vehicle, your auto liability insurance covers damage to the other vehicle and its contents, including the contents of its trunk - up to the limit of your policy.
Most commonly claimed types of reimbursable contents are:
Child booster seat
Mobile phone
Laptop
Clothing
Eyewear
Jewelry
Does Auto Liability Insurance Cover Scratches on your Vehicle?
No, auto liability insurance covers scratches caused by you to another vehicle, in an at-fault accident. For instance, if an insured scratches the side of another person’s vehicle while trying to maneuver their truck, the insured’s auto liability insurance will provide property damage coverage. Auto liability insurance will not cover the resulting scratches on the insured’s own truck.
What is not Covered by Auto Liability Insurance?
Auto liability insurance in Texas does not provide coverage for policyholder’s damages or injuries. That is, it does not offer coverages such as:
Collision
Comprehensive
Medical payments
Personal Injury Protection
Theft
What Does Auto Liability Insurance Typically Exclude?
Collision insurance: Auto liability insurance will not repair or replace damages done to your vehicle, regardless of who caused the accident. If your car crashes into another vehicle or someone crashes into you, which causes serious damage to your car, it is your collision insurance that will cover you, not auto liability insurance.
Comprehensive insurance: Auto liability insurance also does not cover damages done to an insured vehicle by things other than a collision with another car. Auto liability coverage does not cover damage caused to a vehicle by natural disasters like floods, fire, hail, or even riot and vandalism. So if hail breaks your windshield, you can rely on your comprehensive insurance coverage instead.
Medical payments: Auto liability insurance will not pay for the policyholder or passenger’s medical expenses because it is only designed to pay for the medical cost of caring for bodily injury caused to another person (in another vehicle) in an at-fault-covered accident.
Personal Injury Protection: Generally, auto liability only covers another party’s medical expenses, not the expenses of the insured. If the injury to the insured is extensive enough that they are unable to work, the insured needs personal injury protection to cover expenses like lost wages and even funeral costs, if any, regardless of who is at fault.
What is an Example of Auto Liability Insurance?
Texas minimum auto liability insurance limit is $30,000/$60,000/$25,000 (30/60/25), which is required from any driver operating on the roads of the state. Most drivers purchase much higher limits, to minimize the possible financial exposure.
Here is an example of how liability car insurance works in Texas. If you purchase an auto liability policy with the (60/120/40) liability limits, you have protection for:
Bodily injury (BI) liability limit of $60,000 per person, per accident is
Bodily injury (combined) liability limit of $120,000 per accident
Property Damage (PD) liability limit of $40,000 per accident
If you cause an accident that involves more than one vehicle, incurring both property damage (damage to their cars) and bodily injuries. For instance, if the damages caused are:
Person A: Medical costs totaling $40,000 and property damage costs totaling $20,000
Person B: Medical expenses totaling $40,000
Person C: Medical expenses totaling $20,000 and property damage costs totalling $5,000
Your auto liability limit will cover each person involved in the accident. This is because the total medical bills for each person are under the $60,000 limit you have on your auto liability insurance plan.
The total cost per accident for bodily injury for Person A, B, and C adds up to $100,000, which is below the $120,000 limit you have on your plan. So you are still covered.
Your property damage limit of $40,000 will cover the combined $25,000 of bills incurred by Person A and C.
As the at-fault driver, all your liabilities would be covered in this instance because all the liability incurred is within your auto liability coverage limit. However, if the medical bills increase, it is very easy to reach the limits and run out of coverage.
If the bills of any one person go over the $60,000 limit, you will become personally liable for the coverage. If the sum of bodily injury claims from Persons A, B, and C exceed the $120,000 limit, the insured is personally liable for the coverages. the bills of any one person go over the $60,000 limit - you become personally liable for the overage. If the sum of bodily injury claims from Persons A, B, and C exceed the $120,000 limit - the insured is personally liable for the overages.
What is the Most Common Use of Auto Liability Insurance?
Auto liability insurance in Texas is used to protect the policyholder from the liability of having to pay out of pocket for repairing or replacing damaged properties as well as paying for injury to another person(s).
The liability limits are purchased based on the possible anticipated exposures. The higher the limits, the less worried the insured will be. Medical coverage tends to be the main expense, so the most common auto liability limits purchased by Texans are $300,000/$500,000/$100,000 (300/500/100). That is BI: $300,000 per person, $500,000 (total combined) per accident, and PD: $100,000 per accident.
This provides coverage for up to $300,000 of medical bills per person, with a $500,000 cap on bodily injury. Property damage is covered up to $100,000.
Make sure to discuss your auto liability insurance needs only with a state-licensed Texas insurance agent, who can assess your financial liability protection needs and provide professional recommendations.
What is the Difference Between Auto Liability Insurance and Auto Collision Insurance?
Auto collision insurance provides access to various types of coverages that may fully protect autos, besides the protections provided by y protect their autos, besides the protections provided by the state-mandated the state-mandated auto liability insurance. So what makes auto liability insurance different from auto collision insurance in Texas? To answer this, we will look at crucial comparisons and differences of the two coverages:
Auto Liability vs. Auto Collision - Similarities:
The primary similarity between auto liability coverage and collision coverage is that both policies cover damages caused to properties. For instance, both coverages can replace or repair a damaged vehicle and a damaged structure and a damaged structure.
One can purchase both auto liability and auto collision coverages for protection against financial liability in case of an accident.
Auto Liability vs. Auto Collision - Differences:
Auto liability insurance only protects other people, not the policyholder. In contrast, auto collision insurance covers the policyholder.
For auto liability insurance to kick in, the covered accident has to be the insured’s fault; in contrast, auto collision insurance will cover the insured whether the accident is their fault or not.
Auto liability insurance covers both bodily injury and property damages, while auto collision insurance only covers damage caused to property.
Do I Need Auto Liability Insurance if I Have Medical Payment Insurance?
Yes, you need auto liability even if you purchase medical payment insurance under your auto insurance policy. This is because medical payment insurance will not protect the other drivers injured due to your fault in an accident. Meanwhile, auto liability coverage will cover the expenses following treatment of the other driver.
For instance, auto liability coverage will protect the insured from these liabilities when an insured crashes into another vehicle in an intersection and causes severe damage to the car and injury to the driver. “But what about the insured?”
If the insured gets injured in the accident also, auto liability insurance will not cover them. Instead, the medical payment insurance will cover the insured’s medical expenses. Medical payment coverage also applies to your passengers. Medical payment coverage also applies to your passengers.
Do you Need Auto Liability if you Don't Own a Car?
Generally, Texas does not require Texans to have auto liability if they do not own a car. However, if you drive someone else’s vehicle, you may want to consider purchasing auto liability coverage in the form of non-owner auto insurance. Non-owner auto insurance, just like liability coverage, provides coverage for bodily injuries or property damage to another vehicle the insured crashes into while driving someone else’s car.
If you seek additional auto auto coverage, speak to a state-licensed insurance agent to help you evaluate your insurance insurance needs.
Who Can Get Auto Liability Insurance?
Any Texan who has reached the legal driving age of 16 and owns a vehicle must get auto liability insurance as a state minimum requirement to prove their financial responsibility.
To know more about the auto liability requirements in Texas, you need to consult with a state-licensed insurance agent.
Who Qualifies for Auto Liability Insurance?
In Texas, anyone who is considered a legal resident and is 16 years old years old and above qualifies. The applicant must possess a valid driver’s license issued by any state.
Who Needs Auto Liability Insurance?
Apart from being a Texas requirement, you need auto liability for liability protection in case you cause a car accident, which results in damage to others and/or their property. in case you cause a car accident, which results in damage to others and/or their property.
Who Should Get Auto Liability Insurance?
You should get auto liability insurance if:
You do not want to be penalized under the state laws for violating the state minimum requirement of proving financial responsibility. The Texas Financial Responsibility Law requires Texans who own vehicles to carry proof of the Texas Liability Insurance Card. Failure to possess it is an infraction of rule §5.204 of the Texas Administrative Code. Such individuals commit a misdemeanor with a fine of about $175 to $350 for the first offense, and subsequent crimes are punishable by a fine of $350 and $1,000. Their licenses are liable to be suspended by the Texas Department of Motor Vehicles, unlessand the license will remain suspended until the offender provides proof of compliance with the financial responsibility of Texas.
You do not want to pay out of pocket for medical or repairs and replacement costs in accidents where you are the culprit in accidents where you are the culprit.
Insurance agents licensed in Texas can help clarify any questions about auto liability insurance.
What are the Benefits of Auto Liability Insurance?
Without auto liability insurance in Texas, individuals face the payment of damages from their own savings. In addition to this, the state will penalize them for violation of the law. If you wonder if auto liability insurance is beneficial to you, look at the pros and cons of auto liability insurance.
Contact a state-licensed insurance agent to know more about the benefits of an auto liability insurance plan.
Why is Auto Liability Insurance Insurance Good?
Being a state-mandated coverage, auto liability insurance protects the interests of all drivers sharing the road with the insured.
Auto liability insuranceAuto liability insurance provides financial protection when you cause injury and/or/or damage to another person and their property and their property in an at-fault accident.
Auto liability protects you against lawsuits, especially when the damage caused to other people is significant.
Limits of coverage are flexible above the state limit. They can be raised to accommodate any level of liability.
Coverage is much less expensive than any of the other “full coverage” protections.
Limits of coverage are flexible above the state limit. They can be raised to accommodate any level of liability.
Coverage is much less expensive than any of the other “full coverage” protections.
Being a state-mandated coverage, auto liability insurance protects the interests of all drivers sharing the road with the insured.
Why is Auto Liability Insurance Bad?
Auto liability insuranceAuto liability insurance does not directly paid-out benefits to the insured property for an insured’s medical bills or repairs or replacement of property damaged when they are at fault in a covered accident.
You may end up losing your driver’s license to suspension if you do not purchase at least the state - minimum - required auto liability insurance.
Seek further clarifications by speaking to a state-licensed insurance agent.
Is Auto Liability Insurance Worth it?
Yes, auto liability insurance is worth it because it protects a policyholder when they are at fault in an accident that causes bodily injury and/or/or property damage to others and their things. Also, having it guarantees you are not breaking the state law.
Speak to a licensed insurance agent in Texas to figure out the proper amount of auto liability insurance you should get.
What Happens if you Don’t Have Auto Liability Insurance?
You will be violating the law if you drive without auto liability insurance coverage. Also, you will be liable to pay all out-of-pocket costs for any bodily injury and property damage you cause when you cause a car accident.
It may cost $50,000 or more for one person to be hospitalized after a car accident. What if there were multiple people in the car or cars you ran into?
Paying large sums of money out of pocket is likely to put a strain on your finances. In the absence of liability coverage, you may be sued . In the absence of liability coverage, you may be sued and may even end up having to file for bankruptcy.
These are the gaps that auto liability insurance covers by protecting individuals from being financially responsible for the liability incurred due to an accident caused by them.
Why is Auto Liability Insurance Important?
Auto liability insurance in Texas is important because it allows the insured to shift the risk of liability of having to pay for damages caused to others - to a third party, the insurance company. It allows the insured to shift the risk of liability of having to pay for damages caused to others - to a third party, the insurance company. Auto insurance provider covers the payment of property damages and bodily injuries caused by a policyholder in an at-fault-covered accident.
What Happens When your Auto Liability Insurance Lapses?
When you have a lapse in your auto liability insurance in Texas, it means you have lost auto liability coverage and do not have a state-mandated coverage in place as required by the Texas Motor Vehicle Safety Responsibility Act.
Lapse of the auto liability insurance happens when the insured fails to make a payment within the grace periods of 31 days.
Even if the decision to have a lapse is not intentional, the insured needs to avoid lapse as much as possible. Not only do you lack protection when you cause an accident that causes bodily injury or property damage, but you will also be penalized by the state and risk an increased auto insurance premium. In Texas, such individuals are liable to pay a fine and may get their license suspended.
If you want to drive your vehicle in Texas, you must do so legally and maintain a current auto liability coverage, at the very least meeting the minimum state limits of ($30,000/$60,000/$25,000).
For insurance-related questions, always seek out a state-licensed professional.
