Cheap Liability-Only Car Insurance for 2024: Complete Guide
Key Insights
- Liability car insurance is mandatory for every driver in any state of the country.
- As per the basic earning of the lower middle class and lower class citizens, this coverage is also not affordable for every driver.
- There are some car insurance companies that provide cheap rates for liability car insurance.
- A driver can add other policies to the existing liability coverage policy.
Are You Looking For Answers To The Following Queries?
- Want to buy liability-only car insurance this year but confused if this is the right choice for you?
- Thinking if you should buy full coverage insurance instead of liability only?
- Or you have heard about liability-only coverage somewhere and now you want to know more about it?
This blog has detailed answers to all your queries.
What is Liability only Car Insurance?
Liability-only means, the driver will buy the insurance that can cover the bodily injury or property injury of the other person. Liability insurance is only for the other driver or pedestrian involved in the accident, not for you. It will cover the medical bills and repair bills of that driver or pedestrian and not yours.
Every state has its only legal minimum auto insurance requirement for the drivers. This minimum requirement can also be referred to as liability-only insurance.
Most of the liability policies are divided between bodily injury and property damage coverage. It is represented in three numbers like 20/40/15. This means a $20,000 limit for bodily injury per person.
If there were multiple people involved in the accident then the limit will increase to $40,000 per accident. Moreover; a $20,000 limit for property damage was caused to the other driver.
Which Insurer Provides Cheapest Liability-only Car Insurance?
Finding an insurance company that can provide the cheapest liability-only rates is not an easy task in the USA. There are fifty states in the USA and each state has its list of top insurance carriers.
When we created a raw list of the cheapest insurance companies in each state, there was a major problem. The companies popular with cheap rates in one state were not even functional in other states.
Hence, RateForce decided to create a list of the companies which are available in all the states with the cheapest rates. Here is the information we collected and analyzed based on our sample driver.
The list of most popular insurance carriers all over the country which are providing affordable insurance rates.
| Popular Insurance Carriers | Annual Rates |
|---|---|
| USAA | $415 |
| State Farm | $720 |
| GEICO | $815 |
| Progressive | $905 |
| Nationwide | $1,010 |
| Allstate | $1,290 |
| Travelers | $1,389 |
| Farmers | $1,405 |
Now let’s have a look at some of the smaller companies which provide the cheapest liability-only insurance rates.
| Small Insurance Carriers | Annual Rates |
|---|---|
| Farm Bureau Insurance | $513 |
| Erie | $408 |
| Auto-Owners Insurance | $750 |
| American Family | $915 |
| MetLife | $987 |
It is clear from the above data that USAA has the cheapest insurance rates among all the major insurance carriers. And Erie has the cheapest insurance rates among all the small insurance carriers but not available in all the states.
*Please note that these are the rates of a sample driver with clean driving records. There are a lot of factors that affect the car insurance rates of a driver in every state. Make sure to mention all your information clearly to get the most accurate rates.
Liability-only Insurance Rates After Ticket or Accident
A risky driver always gets higher insurance rates for any type of coverage. So who exactly is a Risky driver?
A driver with a traffic violation ticket with a DUI or speeding ticket or a driver with an at-fault accident. These two factors define if a driver is going to file huge claims or not.
So if a driver already had an at-fault accident on the record then there are chances of getting into an accident again. Similarly, if a driver already got a DUI ticket that means the driver is irresponsible and can get into an accident.
Now let’s have a look at the top companies which provide affordable rates of liability-only insurance after a ticket.
| Company | State Minimum Liability |
|---|---|
| USAA* | $459 |
| GEICO | $762 |
| Nationwide | $834 |
| State Farm | $802 |
| Allstate | $887 |
| Progressive | $956 |
| Farmers | $1,123 |
| Travelers | $1,078 |
| MetLife | $1,168 |
It is clear from the table that USAA provides the lowest rates but it provides coverage to only military members and veterans. If you are neither a military member nor a veteran then you can go for GEICO.
Liability-only Insurance Rates For Drivers With At-fault Accident On The Record:
If you have an at-fault accident on your driving record and you need liability-only coverage then this might help you. Here’s the list of top companies that provide affordable insurance rates throughout the country:
| Company | State Minimum Liability |
|---|---|
| USAA | $656 |
| GEICO | $863 |
| State Farm | $849 |
| Nationwide | $1081 |
| Allstate | $1113 |
| Progressive | $1278 |
| Farmers | $1,317 |
| Travelers | $1,279 |
| MetLife | $1,867 |
Clearly; GEICO provides the lowest liability-only insurance rates for the drivers who have an at-fault accident on the record.
Average Minimum Liability Car Insurance Quotes By State
Your location plays an important role in the calculation of insurance rates. Your country, state, city, and even zip code affect the insurance quote for every driver. The insurance company checks for factors like the crime rate in the area, the possibility of natural calamities, and accident statistics.
Based on all these kinds of factors the companies then provide the insurance quotes to the drivers. Below is the list of average monthly liability-only insurance quote for all the states of the USA:
| State | Monthly Cost of Liability-only Insurance |
|---|---|
| Michigan | $225 |
| Florida | $190 |
| Rhode Island | $128 |
| Delaware | $124 |
| Louisiana | $129 |
| Nevada | $118 |
| Utah | $103 |
| Kentucky | $103 |
| Maryland | $102 |
| New Jersey | $102 |
| New York | $102 |
| Oregon | $98 |
| D.C. | $98 |
| South Carolina | $91 |
| Illinois | $89 |
| Colorado | $89 |
| Georgia | $81 |
| Texas | $81 |
| Mississippi | $82 |
| Arizona | $78 |
| Minnesota | $77 |
| Oklahoma | $75 |
| Alabama | $73 |
| Pennsylvania | $73 |
| New Hampshire | $71 |
| Connecticut | $71 |
| Idaho | $68 |
| Arkansas | $65 |
| Washington | $63 |
| Virginia | $63 |
| Missouri | $62 |
| Nebraska | $61 |
| New Mexico | $63 |
| Massachusetts | $61 |
| West Virginia | $61 |
| Indiana | $53 |
| South Dakota | $52 |
| Iowa | $41 |
| Wyoming | $58 |
| Wisconsin | $55 |
| Alaska | $51 |
| California | $53 |
| Hawaii | $56 |
| North Dakota | $51 |
| Vermont | $51 |
| Ohio | $52 |
| Maine | $53 |
| Montana | $46 |
| Kansas | $39 |
| Tennessee | $39 |
| North Carolina | $32 |
It is clear that; Michigan has the most expensive car insurance rates and North Carolina has the cheapest rates.
Liability vs. Full Coverage Car Insurance
Which one is better liability only or full coverage car insurance? This is one of the most common confusion among the drivers. The simple answer to this question is; it depends on the age and value of the car.
- If your car is older then it is better to get liability-only coverage. The reason behind this is; Older cars always get higher full coverage insurance rates. With time the value of the car starts decreasing and then it increases insurance premium rates.
- If you know that your vehicle’s value is higher than the insurance premium it is better to get full coverage. Or if your car is new then also it is advisable to get full coverage insurance. The average cost of full coverage insurance in the USA is $1280. Do you think the value of your car is higher than this? If yes then you should buy full coverage insurance for your vehicle.
Should I Switch To Liability-only Car Insurance?
Do you already have full coverage insurance and now you are confused if you should switch to liability-only? Then we are here to help you make a quick decision.
As mentioned above; full coverage car insurance is important when your car is new or has a high value. As your car gets older the value of collision and comprehensive coverage will start decreasing. And the amount of full coverage insurance premium will increase.
The reason behind this is; the actual cash value or ACV of the car. Actual cash value is the money your insurance company will pay to fix your car after an accident. ACV can also be defined as the value to buy an identical vehicle today.
So in case of a total loss of an old car, the cost of repair will be more than the actual value of the car. As a result, the insurance carriers usually just write a check for the ACV of the car. But in the case of a new car with high value; it will be different. The value of repairing the car will be less than the ACV so the insurance company will repair the car
Let’s understand this with an example;
Consider you have 2 cars. One is a year-old Honda and the other is a 10 years old Audi.
- Now the actual cash value of the new Honda will be identical to the cost of buying the same model today. And the actual cost value of a 10 years old Audi will be the cost of buying the same model today.
- Let’s consider the ACV of Honda is $5000. So the maximum amount the insurance company will pay to repair the car will be the same. In case of a total loss, the company will simply write a cheque of $5000.
- But in the case of Audi; let’s consider the ACV of Audi is $20,000. So that will be the maximum amount the insurance company will pay to repair the car. In case of total loss; the company will first try to repair the car instead of giving you $20,000.
- Another important thing to keep in mind is; with time this ACV value will keep decreasing and the premium value will keep increasing. If you are paying $1290 for full coverage right now then next year you might have to pay $2000.
As a result; it is always better to drop full coverage insurance if your vehicle is too old and undervalued.
When You Should Consider Liability Only Coverage?
Here are four situations where liability-only coverage is most suitable, check out if these apply to you:
- You have an alternate vehicle and you don’t drive the car much: Do you prefer to move around on a bicycle or a bus and use your car only in emergencies? If yes then you can perfectly rely on liability-only coverage. Because at the end you know that your car is going to be in the garage only most of the time.
- You can afford a new car if this one is stolen: If you know that your present car is not that valuable and it would be better to replace it. In such situations, you can skip the full coverage insurance and get the basic liability-only coverage.
- The damage risk is low: If you are a responsible and experienced driver then the chances of getting into an accident are low. You avoid driving at night, you never drive under the influence and you are not younger. As a result; you can try your luck to get liability-only coverage.
- The chances of your car getting stolen are low: If you know that the crime rate in your area is comparatively low and you have high security. Also; if you park your car in a garage or you have a dedicated parking space in your office. In such situations, the car is usually safer and you can go for liability-only coverage.
When you should not consider Liability only Coverage?
Now we know when liability-only coverage is best, let’s have a look at when it is not ideal for us:
- If you have a lease or loan on the car: Most of the financing companies ask to buy collision and comprehensive coverage compulsory for the drivers. This is a way to protect the company while you are still paying their monthly installments.
- If you have a new vehicle: As mentioned above; your new car has a higher value than the collision and comprehensive coverage. As a result; it is better to buy full coverage.
- If you live in an unsafe area: This is applicable when you know that your locality is prone to vehicle stealing. Also; you don’t have a private garage then it is better to avoid liability-only coverage.
How To Get Cheap Rates For a Liability Policy?
There are two ways to get affordable insurance for every driver from any state in the USA:
- Get Discounts
- Shop Around and Compare the rates
Let’s understand the impact of both the ways separately.
Ask for as many discounts as possible
Discounts are the best ways to decrease the cost of insurance instantly. There are a lot of discounts which most of the drivers are not aware of. The insurance companies usually avoid talking about discounts so you will have to ask about it. Here are different types of car insurance discounts every driver should know about.
Shop around and compare the rates from different companies
This is one of the best methods to get the cheapest insurance rates for your vehicle. All you have to do is ask for quotations from different companies and compare their rates. There are two ways to get quotations from different companies:
Manual
The manual way to get the rates from different companies is time-consuming and complex. Firstly; you will have to make a list of all the companies in your area. Then you will have to call each company and explain your requirements.
After that, they will analyze your profile and will provide you the quotation in a day or two. You will have to wait until you get the quotation from all the companies and then you can compare the rates.
Automatic
This is much simpler and quicker as compared to the manual method. All you have to do is enter your information on the website once and they will create a list of all the companies in your area. The list will include the quotation for liability only as well as full coverage rates. You can compare the rates from multiple companies at one place in just a few minutes.
RateForce is proud to be one of the best insurance comparison sites that can provide the best insurance rates from multiple companies. We have a well-defined software where you just have to add your information. You will get car insurance quotes online .
FAQs About Liability-only Car Insurance
-
What is the risk of getting Liability only car insurance?
Liability-only insurance covers only the minimum requirements of the state. If the bills exceed the liability coverage limit then you will have to pay for the extra expenses. For example, you have a bodily injury coverage of $20,000 but the bill is $30,000 then you will have to pay $10,000.
-
What does liability-only auto insurance cover?
Liability only insurance provides coverage of the medical bills and repair bills of the other driver if you are at-fault. The insurance company will cover the expenses only up to the coverage limit defined by the states.
-
What is not included in the liability only auto insurance coverage?
Liability only covers strictly only what’s written on the minimum requirement contract. The medical bills of the driver or the passengers are not included if you are at fault in the accident. Moreover; rental car coverage, comprehensive coverage, collision coverage, and emergency roadside assistance are also not covered.
-
What do the liability limit numbers represent?
The liability numbers represent the maximum limit of the coverage that the insurance company will provide. The liability limits are usually represented in a set of three like 30/40/50.
In this example, 30 represents $30,000; the limit of medical bills coverage per person of another driver. 40 represents $40,000 which means the maximum coverage for all the persons injured in the accident. And 50 represents $50,000 to cover all the expenses of the property damage of the other driver. -
Does liability-only insurance cover my vehicle if someone else is at-fault in the accident?
No, it will not cover your vehicle even if you are not at fault. For such situations, you can buy uninsured or underinsured motorist coverage. If another driver is at fault in the accident and does not have enough insurance to cover your expenses then this will help.
-
Should I buy Liability Auto insurance if my state does not require it?
Even if your state law does not require minimum liability coverage it is advisable to buy the insurance. At Least the amount which can cover both types of coverage; bodily injury and property damage. This will protect you in case you are at-fault in an accident.
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If my car is totaled and I only have liability insurance will I get coverage?
If you only have liability insurance then your company will not cover expenses for the damage to your car. You will have to pay for the replacement of your vehicle. Or else, if you have another driver a fault then you can claim to its insurance company. You might get the entire coverage to replace the vehicle or you will get a certain percentage. This depends on the insurance company.
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Editorial Guidelines: The above is meant as general information to help you understand the different aspects of auto insurance. This information does not refer to any specific auto insurance policy. Coverages and other features vary between insurers, vary by state, and are not available in all states. References to costs of coverages/repair, average or typical premiums, amounts of losses, deductibles, etc., are indicative and may not apply to your situation. We encourage you to speak to our insurance representative and to read your policy contract to fully understand your coverages.
Randy Luton is the Founder and CEO of RateForce. He is passionate about InsurTech services and has in-depth knowledge about the auto insurance sector of the USA.
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