The function of auto liability insurance is to pay on behalf of the insured money damages for which the insured becomes legally liable to others for bodily injuries or property damages. Also included is defense against claims or suits for such liabilities.
- The policy will only cover those that have the status of insured, which can vary by policy form.
- Payment is only for “legal liability.” Legal liability arises from negligence which can include not maintaining your car.
- To trigger payment, the legal liability must be for bodily injury or property damage.
- When a claim is made against an insured the insurer becomes the insured’s defense lawyer in the case. This is called a duty to defend, and with it the insurer will also have the right to settle the claim in the most advantageous manner to itself.
Auto liability coverage will also cover supplementary payments that occur during the claim including interest that accrues after judgement, premiums for appeal bonds and bonds to release attachments. In addition, the company must pay for the cost of bail bonds, up to $250, and up to $200 per day for the insured’s loss of earnings because of attendance at trials or hearings.
Who Is Insured?
- The named insured and family members.
- Any person using your covered auto by permission
- Anyone legally responsible for your auto, but only for acts or omissions of one who is otherwise an insured.
- For any auto or trailer other than your covered auto, anyone else who does not own or hire the vehicle, if liability is from an act or omission of the named insured or a family member.
Liability coverage is not provided in Florida to any insured:
- Who intentionally causes injury or damage
- For damage to property owned or being transported by that insured.
- Except for damage to a residence or private garage, for damage to property rented to, used by or in the care of that insured.
- For injury to an employee in the course of employment.
- For an insured’s liability arising from use of a vehicle as public or livery conveyance.
- While employed or engaged in a business of selling, repairing, servicing, storing or parking vehicles.
- Except as to a private passenger auto, pickup or van, or a trailer.
- Using a vehicle without a reasonable belief of permission.
- For bodily injury or property damage for which that insured is an insured under a nuclear energy liability policy to the named insured or a family member.
Auto liability insurance is issued subject to coverage limits on either of two bases:
- Single limit – means one limit will apply to all claims for bodily injury and property damage arising from a single accident. The lowest single limit offered is $30,000.
- Split limits – means three separate limits apply: one for each person injured, another for the claims of persons injured in one accident, and another for all property damage in one accident. This is order, so for example in Florida the minimum coverage as is 10/20/10. This means 10k per person, 20k per accident for all people, and 10k for property. Usually split limits are higher.