Cheap Liability-Only Car Insurance | Bankrate (2024)

Insurance Disclosure

Updated Mar 25, 2024

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What is liability-only car insurance?

Liability-only car insurance covers the damage to other vehicles, people or property you are responsible for in the event of a covered accident. This can include repairs to the body of the other driver’s vehicle and their medical expenses. What this type of policy does not cover, however, are the damages that you incur in an at-fault accident or a non-collision loss, such as a vehicle fire or theft. While carrying the cheapest liability car insurance can help you keep premiums down, you will likely have to pay out of pocket for your own car repairs if you are at fault for the damage.

The same goes for other drivers; in the event that the other driver is at fault for an accident, their insurance would typically kick in to pay towards your medical expenses and vehicle repairs.

What is PLPD insurance?

Property liability property damage (PLPD) insurance is one-half of a standard liability-only car insurance policy. The PLPD insurance portion of liability coverage is specifically for property damage caused by your vehicle. For instance, if you hit another car and damage its door, this portion of your liability policy may pay out toward those damages. The other portion of liability policies is called bodily injury liability, and it pays out toward medical costs for those injured in an accident where you are at fault.

What is minimum coverage?

Minimum coverage refers to carrying only the minimum amount of car insurance coverage required by your state. This required coverage can vary, but almost always includes bodily injury liability coverage and property damage liability coverage, which make up liability-only insurance.

In some states, minimum coverage car insurance also requires personal injury protection (PIP) coverage and uninsured and underinsured motorist coverage.

Note that liability-only coverage is likely only an option if you own your vehicle outright. If you have a loan or lease, your lender will typically require you to have full coverage. It is also worth noting that, like “full coverage,” “liability-only coverage” is not an industry-standard term. Some companies may consider medical payments or PIP to be a part of a liability-only policy, especially if your state requires them.

Cheapest liability-only car insurance

Based on our research, the companies that offer some of the cheapest minimum coverage insurance are Auto-Owners and USAA, followed closely by Geico, Travelers and Progressive. All five of these companies offer average liability-only car insurance rates below the national average cost of $741, according to Bankrate’s research. While these average rates are for cheap liability car insurance, based on 2024 rates from Quadrant Information Services, keep in mind that minimum coverage requirements and costs will vary based on the state where you live, since each state sets its own minimums for liability coverage.

Auto insurance rates are known to fluctuate frequently, but you can rely on Bankrate to offer you the latest options available.

Finding cheap car insurance is a priority for many drivers. Getting quotes from several carriers may be helpful, as it allows you to compare rates for the same coverage from multiple companies. Although minimum coverage is often one of the cheapest liability-only insurance policies available, due to its low limits, most insurance experts recommend that you purchase more than the minimum limits if you can afford to. If you cause an accident and the damages and injuries exceed your liability coverage limit, you will be responsible for paying the overage out of pocket.

When choosing an insurance company, there are other factors to consider in addition to price. You may also want to review a company’s customer satisfaction scores, financial strength ratings, coverage options, discounts and digital tools. Everyone has different wants and needs when it comes to insurance, so getting quotes from several carriers might help you find the right policy for you.

How much does liability-only car insurance cost?

Each state has unique laws and risk levels that affect the cost of liability car insurance. Because of this, buying only minimum coverage may be significantly less expensive in some states than in others when compared to buying full coverage. For example, the average cost of car insurance for minimum coverage in Vermont is $311 per year, which is 77 percent less than the average cost of full coverage in the state. But the average cost of minimum car insurance coverage in Louisiana is $953 per year, 74 percent less than the average cost of full coverage in the state.

While full coverage insurance does usually cost more than minimum coverage, it provides a greater level of financial protection. Full coverage includes comprehensive coverage and collision coverage, which cover damage to your vehicle regardless of fault — something that is not included in minimum coverage.

Average annual cost of car insurance by state

*Based on full coverage policies for 2024.

Auto insurance rates are known to fluctuate frequently, but you can rely on Bankrate to offer you the latest options available.

How much cheaper is liability vs. full coverage?

The price difference between liability and full coverage insurance will depend partly on how much liability coverage you buy. Liability auto insurance is not one-size-fits-all. You can purchase different levels of coverage that provide you with more or less financial protection. State minimum policies provide very minimal financial protection, while a policy with higher limits gives you more. If you cause an accident, a liability-only policy will only pay up to your policy’s limited allowance for the injuries and damages you cause to the other car and its driver and passengers. The higher your limits, the more coverage you have and the more your insurance will likely cost.

You might pay around $1,000 more for full coverage than a minimum coverage policy, depending on the insurance company you choose. However, a liability-only policy with limits higher than the state minimum may also cost more than a minimum coverage policy. In that case, the price difference between full coverage and a liability-only policy with higher limits may not be as significant.

Average annual cost of minimum coverage insurance vs. full coverage

Auto insurance rates are known to fluctuate frequently, but you can rely on Bankrate to offer you the latest options available.

Why is liability-only so much cheaper?

Liability-only car insurance is usually cheaper because it offers less financial protection than a full coverage policy, and there are fewer instances where you could file a claim with your insurer. If you have liability-only car insurance, you would not be able to file a claim if:

• Your car is stolen
• You hit a deer or other animal
• Your car is damaged from extreme weather, such as hail or fallen tree limbs
• Your vehicle is damaged in an accident you caused

A full coverage car insurance provides protection for a wider variety of claims, even ones where you are not at-fault for the damage. And when it comes to car insurance, higher protection levels typically translate to higher premiums.

Is liability-only auto insurance right for me?

Liability-only coverage might be a good fit for you if:

• You own your car outright: If you have a loan or lease on your vehicle, you will very likely be required to carry full coverage, so liability-only coverage is probably only an option if you own your car in full.
• Budget is your primary concern: Because full coverage provides greater financial protection in the form of coverage for damage to your car, it is more expensive than minimum coverage or liability-only coverage. But keep in mind that paying for less financial protection means that your budget will likely take a bigger hit if you cause an accident.
• Your vehicle is not worth much: If your vehicle is older and does not have a high market value, it may not make financial sense to pay for full coverage, since the cost of repairing the car might be more than the car is worth. Be sure to evaluate the car’s replacement value to see if the value of the totaled vehicle justifies the higher cost of comprehensive and collision coverage.
• You are not concerned about vehicle damage: If you are not worried about damage to your vehicle and do not think you would repair damages to your vehicle, liability-only might be a good choice.
• You have the finances to repair or replace your car: If you own your car outright and have the finances to repair or replace it if it is damaged, without putting a significant strain on your financial health, liability-only coverage could be a viable option.

If you are unsure if liability-only coverage is right for you, working with an agent could be helpful. An agent can assess your situation and help you choose coverage that is appropriate.

What happens if my car is totaled and I only have liability insurance?

If your vehicle is totaled and you only have liability insurance, the claim payout would depend on how fault is determined after the accident. If you were not at fault for the accident and your vehicle was totaled, you may be able to file a claim with the at-fault driver’s insurance policy. But, if you were found at fault for the accident, you would need to pay to replace the vehicle yourself. In order for your insurance company to replace or pay for your totaled vehicle, you would likely need a full coverage policy. Depending on your insurer, new car replacement may also come in handy in this instance.

What are the primary risks for liability-only car insurance?

Carrying a liability-only car insurance policy exposes you to more financial risk than a full coverage policy would. With full coverage car insurance, your policy includes comprehensive and collision insurance. This means you are protected from the damage done to your vehicle in a wider variety of circ*mstances.

With a liability-only policy, your insurance provider can only help cover the damage you cause, like if you run a red light and T-bone another vehicle. In that case, insurance may pay for the other driver’s repairs — but you would be on the hook for the damage to your own car.

How does liability insurance cost vary by car model?

Put simply, the higher the potential your car has for causing damage, the higher the liability insurance cost. Remember, liability insurance only pays for the damage you cause, and repair estimates for your vehicle do not factor in. If you drive a larger truck, your liability insurance premium would likely be higher than a smaller compact vehicle.

For example, our data from Quadrant Information Services shows that the average cost of a liability-only policy for a Honda Odyssey is $683 per year. Meanwhile, a Ford F-150 costs more, an average of $705 per year.

Because full coverage car insurance policies do consider your vehicle’s repair costs (among other factors) when calculating your rate, the variation make and model tends to be more drastic. Our research shows that, on average, it costs 8 percent more for a Ford F-150 full coverage policy compared to an Odyssey.

Methodology

Bankrate utilizes Quadrant Information Services to analyze 2024 rates for ZIP codes and carriers in all 50 states and Washington, D.C. Rates are weighted based on the population density in each geographic region. Quoted rates are based on a 40-year-old male and female driver with a clean driving record, good credit and the following full coverage limits:

• $100,000 bodily injury liability per person
• $300,000 bodily injury liability per accident
• $50,000 property damage liability per accident
• $100,000 uninsured motorist bodily injury per person
• $300,000 uninsured motorist bodily injury per accident
• $500 collision deductible
• $500 comprehensive deductible

To determine minimum coverage limits, Bankrate used minimum coverage that meets each state’s requirements. Our base profile drivers own a 2022 Toyota Camry, commute five days a week and drive 12,000 miles annually.

These are sample rates and should only be used for comparative purposes.