What is Bodily Injury Coverage?

Did you know that bodily injury coverage is the foundation of your auto insurance policy? It’s essential when putting your car on the road and what you have in your corner if you cause an accident. If you learn only one thing about car insurance, let it be about this. It’s that important.

Why do I need bodily injury coverage?

The shortest answer is that New York State requires you to have bodily injury coverage to register a car for the road. That was easy. Thanks for coming to our TED Talk!

But you didn’t come here for the short answer, right? Didn’t think so.

While it’s true that you need bodily injury coverage to put your car on the road, there’s a lot more to this coverage. Let’s unpack the details using some of the most common questions we receive on the topic.

What does it cover?

We’ll unearth what your bodily injury limits cover you for in a moment. But first, think back to the last time you drove by a bad accident. Like many, you turned your head a bit to see the aftermath.

Do you recall smashed up cars, an ambulance, and the police? We’ve all seen our share of these; some were worse than others. There is one thing all those accidents had in common. Somewhere in that chaos was the driver that caused the whole thing.

Do you know who else is there? All the people hurt or even killed in that accident. Enter bodily injury coverage.

Bodily injury insurance coverage is used to compensate those who were affected in the accident. This does not cover the bodily injuries to the driver who caused the accident, only those injured because of it.

Of course, this coverage lives up to its name and pays for injuries, meaning the medical costs to treat them. It also pays for the other person’s loss of income if they cannot work after the accident. Since death is the ultimate injury, you can also add funeral costs to the list.

Your bodily injury coverage also handles their pain and suffering. Yet, that can be hard to figure out and usually involves a lawsuit. Fortunately, your legal expenses are also a part of this coverage.

What do the limits mean?

The state requires you to have at least $25,000 for any person injured and at least $50,000 available for the whole accident. This is called split limit coverage. If you’re like others, you might find this part confusing. Let’s bring this into focus a little.

$25,000 is the most any one person could collect, and $50,000 is the total we have to work with. You’ll see this listed on your policy as $25,000/$50,000. Below are some real-world examples of this in action.

Example 1: Suppose Steve suffers $33,000 in injuries. Since $25,000 is the most any one person can get, you don’t have enough to cover all of Steve’s expenses, and Steve could sue you for the difference.

Example 2: Steve and Sarah were each injured in an accident you caused. Steve’s injuries totaled $18,000, and Sarah’s were $21,000. Since each fell beneath $25,000 and their combined total was less than $50,000, enough coverage was available.

Example 3: Steve, Sarah, and Kristy were all injured in an accident you caused. Steve’s injuries totaled $15,000, Sarah’s were $20,000, and Kristy’s were $23,000. At first glance, it seems all is good here too, but sadly, it isn’t. The combined losses of $58,000 are above the $50,000 limit, and you are on the hook for the difference.

The formula we just described remains the same regardless of how much coverage you have. So, it’s time to answer a critical question. What’s the right amount of bodily injury coverage?

What is the recommended amount of bodily injury coverage?

You should have as much coverage as you can afford to buy. As the saying goes, “anything is possible,” and there is no way to know how bad a future accident could be. Any savings or assets (including retirement) will be at risk if you run out of liability coverage.

Even without assets, an injured person could still be compensated through wage garnishment. Wage garnishment means your paycheck has money removed for another person’s benefit. It’s best to reduce the likelihood of this and add more coverage.

Many law practices are built on representing people injured in a car accident. They leave no stone unturned when looking for ways to get compensation for their clients. The more coverage you can buy, the more you can refer them to your insurance company.

How expensive is it to add more?

You have now arrived at the most positive part of the bodily injury coverage topic! Adding more coverage is not expensive, and doubling it will not double your price. In fact, you can often go much higher without experiencing a tremendous increase in cost.

Should the cost of adding more go beyond your budget, there is one thing you can consider. If you have comprehensive and collision coverage on a vehicle, you could increase its deductible. Raising a deductible from $500 to $1,000 could free up enough money to buy more liability insurance. It will likely be easier to find $500 to fix your car than to find $100,000 to settle an injury lawsuit!

Ask your agent for the cost differences on all available liability options. Doing so will allow you to make an informed decision.

Are there any other details I should know about?

Yes, there are a couple of extra points worth making to wrap it all up. Below is a brief list of those final pieces.

  1. Bodily injury coverage is policy wide. This means that it is the same amount of coverage for all the vehicles. One car does not have a separate amount compared to another on the same policy.
  2. We mentioned split-limit coverage earlier; this is the most common way to get the coverage. But you can also choose single-limit coverage. Single-limit coverage removes the individual limits and acts as one total amount. Not all insurance companies offer single limits and those who do usually charge more for it.
  3. Your lawyer gets chosen by the insurance company. Since they are paying to defend you, it is the carrier’s decision. So, even if you want them to call Saul, they’ll call Doug.
  4. The carrier can settle at any time and does not need approval. As much as you believe the other person was barely hurt, the carrier might cut their losses and settle. That is especially true if they see costly litigation in the future. If it’s cheaper to settle, they will.

You have now learned what most people only learn after it’s too late. By understanding how bodily injury coverage works and its importance, you are more likely to make an informed decision. Want more car insurance liability information? Check out our article What does property damage liability pay for?  Or learn how to get car insurance.

If you’re done with your quest for car insurance knowledge and want to request a quote, tap the Get Quote button. One of our insurance professionals will reach out in a timely fashion. Should you have more questions, please ask by calling or using the Contact Us inquiry form.

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Horan Companies offers comprehensive auto insurance in New York State, including: Baldwinsville, Syracuse, Onondaga County, Liverpool, Fulton and Camillus, NY.