When you cause an accident, you are financially responsible for any damage or medical costs that result. If you are getting ready to buy a motorcycle insurance policy, you may be wondering, “What is liability insurance and how much do I need?”
The definition of liability is an obligation, responsibility, or debt. Liability insurance is used to pay the costs incurred in an accident you cause, after your deductible, and up to your policy’s defined limits. Find an agent in the Trusted Choice® network today to get all of your questions answered and get accurate motorcycle liability insurance quotes.
What Does Liability Insurance Cover?
- Damage to property of others: You run a light and hit the side of a car, causing damage to the doors. Liability coverage would pay to repair the door.
- Medical coverage for others: The driver of the other car goes to the emergency room, with injuries requiring medical treatment, including surgery and rehabilitative care. Liability coverage would pay the cost of emergency transport and medical bills.
- Lawsuits arising from an accident: The driver sues you because of the accident. Your liability insurance would pay for the legal defense.
How much your liability insurance covers in each of the above scenarios depends on the limits set for your policy. Read on to understand the importance of adequate motorcycle liability insurance.
Motorcycle Liability Protects You Against Financial Loss
The risks of the road are always there, whether you are in a car or on a motorcycle. If you are in an accident and are found to be at fault, you are liable for damages. In the mildest case, this means your motorcycle insurance company pays for damage to another driver’s vehicle to their insurance company.
The worst case scenario is much more important to consider. Even if you never ride recklessly, a moment of inattention that results in another person’s injury or death can result in severe financial consequences. The high costs of property damage, medical payments and/or funeral costs and legal fees can be enough to devastate family finances.
How Do Liability Limits Work?
Each motorcycle liability insurance policy has three parts: bodily injury for one person, bodily injury for all persons involved, and property damage. Each one of these components has a limit that depends on the type of coverage you choose.
For example, if you buy an insurance plan with 30/60/15 limit, your insurance company will pay up to $30,000 for one person’s medical treatment, up to $60,000 for all medical expenses combined, and up to $15,000 for any damage to property.
If you crash into a car and the car is severely damaged and the driver and a passenger are injured, it might look something like this:
- The total cost for repairs is $20,000
- The cost for medical treatment is $100,000
- Your property coverage is $15,000 and your bodily injury coverage is $60,000
- You would be responsible for the remaining $45,000 out of pocket
The total costs you are liable for is $40,000. Your insurance will cover up to $30,000 in damages, resulting in $10,000 out of pocket cost for you.
Umbrella Policies Enhance Your Motorcycle Insurance
Healthcare costs and legal fees add up quickly. Your insurance policy may not be sufficient to cover all of the expenses after a severe accident. An umbrella policy provides an additional line of coverage. It is used when you have exhausted your liability premium.
Take the example above, in which you would owe a total of $40,000 in damages, which exceeds your $30,000 premium by $10,000. If you also have an umbrella policy with a $20,000 limit, the scenario would look much different.
After your insurance company uses your motorcycle liability insurance, it will tap into the umbrella policy. This helps reduce your out-of-pocket costs to the other driver.
Can You Get Accurate Online Quotes?
Finding free online quotes is not difficult. However there are some things you should know:
- To compare quotes from multiple companies, you will need to enter your contact information into multiple databases.
- The process is time consuming.
- Not all of the factors that affect your actual costs will be taking into account in the online quote tool.
- In most cases, you will still need to work through an agent.
The quickest shortcut to comparing coverage, options and rates from multiple insurance companies is to contact an independent agent in the Trusted Choice network. Your Trusted Choice member agent can compare rates for you quickly and can build a customized policy that meets your needs, your budget, and includes all discounts for which you are eligible.
Find an agent in our network today and get the motorcycle liability insurance coverage you need.