What is Property Damage Liability?
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You might be familiar with the collision coverage provision of your current auto insurance policy. But you might not know much about property damage liability, another important provision to add to your policy. Here’s a brief overview of what this type of insurance is and how to determine your coverage amount.
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What is Property Damage Liability?
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In the event you cause an accident involving another vehicle or someone else’s property, property damage liability insurance would cover any damages you are held responsible for. Per ValuePenguin’s Mark Fitzpatrick, some of the damages it covers include fixing the other person’s vehicle or any physical damages to a business or house caused by the accident.
It also pays for lost income that stems from a business closure if it’s determined that the accident caused the closure. In addition, this type of insurance also covers the cost of any legal defense fees related to property damage claims.
Every state requires drivers to carry property damage liability coverage. But the minimum coverage required varies by state.
It’s worth noting that property damage liability does not generally cover damage to your own vehicle or property, and you should consider opting for collision coverage to help cover the cost of repairing your own vehicle.
How do I determine the coverage amount?
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Choose your coverage amount carefully. If your coverage amount is too low, you might have to pay any expenses above your coverage limit out of pocket. If the coverage amount is too high, your monthly premium will cost more. A good rule of thumb is to find a happy medium between these two extremes.
For more guidance on choosing a liability coverage limit, talk to your insurance agent. They’ll give you an expert’s recommendation on how much liability insurance you should have on your auto policy, based on where you live and what you can afford.
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The News Wheel is a digital auto magazine providing readers with a fresh perspective on the latest car news. We’re located in the heart of America (Dayton, Ohio) and our goal is to deliver an entertaining and informative perspective on what’s trending in the automotive world. See more articles from The News Wheel.