In most US states, you must have property liability insurance coverage in order to drive legally. Get behind the wheel of your vehicle without it and you risk losing your driving privileges, going to court, and paying a significant fine. However, besides knowing that it's a requirement, how much do you really know about this type of auto insurance? We want to help you fill in some of the blanks and be a more educated insurance consumer.

What is property damage liability coverage?

Property damage liability coverage pays for property damage that you cause as a result of a traffic accident. For example, perhaps you slid on the ice and destroyed a homeowner's mailbox. Or maybe you hit a portion of a property's fencing trying to avoid a more serious accident. It also covers damage that you cause to another person's vehicle during an accident and to government property, such as a mailbox or lamp post.

If the claim can't be settled out of court, the insurance company will also generally pay any associated legal fees and court costs, up to the limit of your insurance. If you hit a business and cause that business to be closed pending repairs, your policy will also cover lost income from the business being closed, up to the limit of your insurance.

This type of coverage does not cover any damage to your vehicle or your property. Collision and comprehensive auto insurance are designed to insure these areas.

Who needs to have property damage liability coverage?

If you drive in the United States, except for New Hampshire, Arizona, and Virginia, you are required to purchase property damage liability coverage to drive legally. In the three exceptions, you must be "financially responsible" and able to pay for any damage you may cause to another person's property. The easiest way to do this is to purchase property damage liability coverage.

The amount of coverage you are required to purchase varies by state, and ranges from $5,000 to $25,000 per accident. Although purchasing the state minimum amount will keep you from getting in trouble if you are stopped for speeding or another traffic offense, it may not be adequate to cover the damage you might cause as a result of an accident. If the property owner cannot collect enough money to make repairs from your insurance company, they are likely to sue you for the difference. Keep in mind that the cost of an average new automobile is currently $30,000, according to various sources.

Doubling your property damage liability insurance limits will not double your premium. Although many variables come into play when setting an auto premium, there are definite economies of scale when it comes to property damage liability insurance.

How does this type of insurance work and how do you make a claim?

Unlike other types of auto insurance, claims for property damage liability are made by the person who suffered the loss, such as the other driver or the homeowner with the damaged fence or mailbox. They get the insurance information from you (or your attorney) and submit it to your insurance company with a copy of the police report and required documentation about the loss.

In most cases, an insurance adjuster from your insurance company will visit the scene and view the damage. This person will either estimate the cost of the repair or have the homeowner get multiple estimates on what it would take to repair the damage done by your vehicle. There is generally a time limit within which a claim for property damages must be filed. Once approved, payment is sent to the auto shop, to the homeowner, or to the contractor who is making the repairs to their property.

How do you buy property damage liability coverage?

Property damage liability insurance is rarely sold alone. It is typically bundled with bodily injury liability coverage, which covers medical expenses for those people injured in an accident where you were at fault. You'll generally see this bundle represented as three numbers (e.g. 20/40/15). There first number is coverage for bodily injury per person, the second is bodily injury per accident, and the third is property damage liability per accident. The higher your numbers, the higher your insurance premium and the lower your risk.

Prices for property damage liability coverage are not fixed and can vary somewhat among different auto insurance companies. makes it easy to compare auto insurance prices and get online quotes. The price of your insurance will depend on your state, the insurer you choose, your vehicle, your driving record, your address, and your age.

How is property damage liability coverage different from other types of insurance?

Property damage liability coverage differs from other types of auto insurance in that it doesn't cover your vehicle or your property.

This kind of coverage is an essential part of every driver's insurance portfolio. Be an educated consumer by learning as much as you can before purchasing a policy. To get quotes and compare pricing, visit