AutoInsurance.com
Published: June 30, 2022Last updated: October 18, 2022

Property Damage Coverage for Car Insurance

Property Damage Coverage for Car Insurance

In 48 states, property damage liability coverage is a legal requirement for driving. It covers the other party’s property damages in the event of an at-fault accident, meaning an accident you caused. We’ll go over how much property damage liability is required and how much you really need.

Property Damage Liability Coverage

Property damage liability coverage is one of the foundational auto insurance coverages, along with bodily injury liability coverage, which covers the cost of someone’s medical bills resulting from an accident.

What It Is

Property damage coverage reimburses damages to someone else’s property that you caused. The property can be a vehicle or another object like a fence. Together with bodily injury liability, property damage coverage makes up basic liability coverage.

What It Covers

  • The other party’s property damages, including damages to their vehicle and any other property; the at-fault party pays to repair or replace the other party’s property

What It Doesn’t Cover

How It Works

Since property damage liability doesn’t require a deductible, you won’t have to pay anything under your property damage limit for a covered claim. Rather, your insurance provider will reimburse the other party for its damages up to the limit you’ve selected. Beyond that limit, you’d be responsible for paying out of pocket, given you’re in a state other than New Hampshire or Virginia (neither of which requires property damage liability).

Limits

When it comes to the limits, you have two factors to consider: your state’s minimum coverage required and how much car insurance you actually need. Find your state’s minimum coverage requirement below.

State Minimum per-accident limit for property damage liability coverage
Alabama $25,000
Alaska $25,000
Arizona $15,000
Arkansas $25,000
California $5,000
Colorado $15,000
Connecticut $25,000
Delaware $10,000
District of Columbia $10,000
Florida $10,000
Georgia $25,000
Hawaii $10,000
Idaho $15,000
Illinois $20,000
Indiana $25,000
Iowa $15,000
Kansas $25,000
Kentucky $25,000
Louisiana $25,000
Maine $25,000
Maryland $15,000
Massachusetts $5,000
Michigan $1 million within the state; $10,000 elsewhere
Minnesota $10,000
Mississippi $25,000
Missouri $25,000
Montana $20,000
Nebraska $25,000
Nevada $20,000
New Hampshire Not required
New Jersey $5,000
New Mexico $10,000
New York $10,000
North Carolina $25,000
North Dakota $25,000
Ohio $25,000
Oklahoma $25,000
Oregon $20,000
Pennsylvania $5,000
Rhode Island $25,000
South Carolina $25,000
South Dakota $25,000
Tennessee $15,000
Texas $25,000
Utah $15,000
Vermont $10,000
Virginia Not required
Washington $10,000
West Virginia $25,000
Wisconsin $10,000
Wyoming $20,000

That said, the minimum coverage isn’t always enough. Take the minimum coverage in Florida, for example, which is only $10,0001. If you got into an at-fault accident and caused more than $10,000 worth of damages to the other party, you’d have to pay for the remainder out of pocket, not to mention your own damages and injuries.

CheckDID YOU KNOW?

Florida is a no-fault state, meaning that each party is responsible for its own bodily injuries, while the at-fault party is only responsible for the other’s property damages.

Car part repaired Average cost (range)
Front bumper $300-$1,500
Paint damage $500-$2,500
Windshield $250-$1,0002
Rear bumper $300-$1,500
Door $75-$1,000

Car repair costs can quickly add up, especially if the accident was particularly bad. And if the car is declared a total loss, meaning the damages cost more than the car’s actual market value (AMV), you’d be responsible for the entire AMV, which could be far higher than $10,000. For these reasons, we recommend getting a higher limit than the minimum requirement. Don’t worry: You can save money in other ways, like taking advantage of auto insurance discounts.

Who Needs It

Everyone needs property damage liability, but legally, only people living outside of New Hampshire and Virginia are required to have it. That’s because those states have no auto insurance requirements whatsoever. That being said, even if you live in either of these states, we still recommend getting property damage insurance to avoid paying completely out of pocket in at-fault accidents.

Cost

Since property damage insurance is part of liability insurance, meaning it’s bundled with bodily injury liability, it’s hard to tell exactly how much this auto insurance will cost. There are also many factors that affect auto insurance premiums, including credit score, gender, and which state you live in.

On average, liability insurance cost $650.35 per year in 2019, the last year the National Association of Insurance Commissioners published national data. See below for your state’s annual average.

State Average cost of liability insurance in 2019 (low to high)
North Dakota $312.30
South Dakota $337.11
Iowa $350.31
Wyoming $356.08
Vermont $374.06
Maine $375.40
North Carolina $392.06
Wisconsin $421.21
Kansas $426.14
Nebraska $431.71
Idaho $433.66
Montana $437.69
New Hampshire $442.52
Indiana $444.98
Ohio $447.86
Hawaii $478.83
Tennessee $479.43
Arkansas $484.37
Virginia $491.51
Minnesota $502.32
Oklahoma $504.79
West Virginia $515.20
Illinois $521.11
Alabama $527.20
Missouri $527.59
Mississippi $544.43
Pennsylvania $548.58
New Mexico $584.25
Alaska $584.90
Kentucky $609.98
Utah $615.15
California $627.77
Texas $650.17
Arizona $662.55
Massachusetts $664.92
Oregon $684.81
Colorado $704.82
Washington $705.11
South Carolina $715.26
Maryland $749.18
Connecticut $799.45
Delaware $819.36
Georgia $829.86
Washington, D.C. $897.87
Rhode Island $918.30
Nevada $925.71
New York $932.46
New Jersey $958.31
Michigan $979.47
Florida $997.20
Louisiana $1,023.913

Example

Let’s say you have a $25,000 property damage liability limit and you accidentally back into another car as you’re leaving a parking spot, causing them $5,000 worth of damages.

In that case, since property damage coverage doesn’t have a deductible, your insurance provider would pay $5,000 directly to the other party. You wouldn’t have to pay any money aside from your premium. Then, you’d have $20,000 worth of coverage left for property damage liability. Try not to spend it all in one place!

Light BulbFYI

Frontal-impact accidents cause 54% of all passenger vehicle occupant deaths across all types of vehicles4.

Restrictions and Exceptions

Property damage liability doesn’t cover it all. Here are some things it does not cover:

  • Commercial driving, such as for Uber or Lyft
  • Classic cars
  • Custom equipment you added
  • Depreciation
  • Rental car coverage
  • Damage you caused on purpose

How to File a Property Damage Claim

Filing a property damage insurance claim is easy, but you have to do it in a timely manner to obtain the coverage you need.

  1. Call the police. Filing a police report makes coverage for a claim more likely. Plus, in some states, you’re legally required to file a police report for certain types of car accidents. Find out whether you need to file a police report. Make sure to get a copy of the accident report.
  2. Collect evidence. Document all of the damages. Note the other party’s name and their vehicle information, including the vehicle identification number, make, model, and year. Also take note of the date, time, and weather conditions during the accident, as well as the names and badge numbers of any police officers you dealt with. Get the contact information of the involved party as well as their name, phone number, and insurance information. Most importantly, take photos of the damage.
  3. Check your state’s statute of limitations. See how long you have to file your claim per your state’s regulations.
State Property damage claims statute of limitations (in years)
Alabama 2
Alaska 2
Arizona 2
Arkansas 3
California 3
Colorado 3
Connecticut 2
Delaware 2
District of Columbia 3
Florida 4
Georgia 4
Hawaii 2
Idaho 3
Illinois 5
Indiana 2
Iowa 5
Kansas 2
Kentucky 2
Louisiana 1
Maine 6
Maryland 3
Massachusetts 3
Michigan 3
Minnesota 6
Mississippi 3
Missouri 5
Montana 2
Nebraska 4
Nevada 3
New Hampshire 3
New Jersey 6
New Mexico 4
New York 3
North Carolina 3
North Dakota 6
Ohio 4
Oklahoma 2
Oregon 6
Pennsylvania 2
Rhode Island 10
South Carolina 3
South Dakota 6
Tennessee 3
Texas 2
Utah 3
Vermont 3
Virginia 5
Washington 3
West Virginia 2
Wisconsin 6
Wyoming 45
  1. Contact your insurance provider. File a claim and give your evidence to your insurance agent or broker. If the accident was not your fault, file a third-party claim with the other party’s insurance provider. You may have to meet with an appraiser to determine the exact damages before receiving compensation.

Umbrella Policies and Property Damage Liability

Just as an umbrella keeps you dry on a rainy day, an umbrella policy provides you with excess funds in the event you exhaust your coverage limits. For example, if you’ve reached your property damage limit but you still have to pay for $5,000 in damages, an umbrella policy would cover it. It usually starts at $1 million and increases in $500,000 increments6. Remember that umbrella insurance is optional in every state.

How to Compare Property Damage Coverage Options

Whether you’re getting auto insurance for the first time or you’re simply switching auto insurance companies, make sure you’re comparing apples to apples.

  1. Compare quotes from multiple companies to find the best rates.
  2. Make sure you answer all of the demographic questions identically. For example, if your credit score improves between applications, update it across the board.
  3. Ask your insurance agent or insurance broker about coverage options, taking into account the same limits and deductibles.

Conclusion

If auto insurance was a house, property damage liability coverage would be the foundation, a requirement in all but two states. After all, you don’t want to get caught driving without insurance. Read on for answers to more of your auto insurance FAQs.

Frequently Asked Questions

Learn even more about the ins and outs of property damage coverage.

What is property damage coverage?

Property damage coverage is a part of auto insurance that covers damages to the other party’s property, including their vehicle. Together with bodily injury coverage, it makes up liability coverage and is required in every state except New Hampshire and Virginia.

What is a good amount of property damage coverage?

A good amount of property damage coverage meets both your state’s requirements and your needs. The limit should be no less than $25,000, but it will depend on how much you can afford. You should choose a limit that’s as high as you can afford to pay for in premiums.

What are examples of property damage?

These are some examples of property damage:

  • Punctured tire
  • Cracked windshield
  • Dents
  • Broken headlight

Is property damage the same as comprehensive coverage?

No, property damage coverage is not the same as comprehensive coverage. Property damage covers damages to the other party’s property in the event of at-fault collisions, while comprehensive coverage covers damages to your car from events other than collisions, such as theft, vandalism, and weather-related incidents.

Property damage liability exists to cover the other party’s damages, not your own.

  1. Florida Insurance Requirements. FLHSMV. (2022). https://www.flhsmv.gov/insurance/

  2. Estimated collision repair costs. LendingTree. (2022). https://www.lendingtree.com/personal/car-body-damage-repair-cost/#estimatedcollisionrepaircosts

  3. 2018/2019 Auto Insurance Database Report. NAIC. (2022). https://content.naic.org/sites/default/files/publication-aut-pb-auto-insurance-database.pdf

  4. Fatality Facts 2020 Passenger vehicle occupants. IIHS. (2022). https://www.iihs.org/topics/fatality-statistics/detail/passenger-vehicle-occupants

  5. Car Accidents: Statutes of Limitations. Enjuris. (2022). https://www.enjuris.com/car-accident/statutes-of-limitations.html

  6. Should I purchase an umbrella liability policy? III. (2022). https://www.iii.org/article/should-i-purchase-umbrella-liability-policy-0