When shopping for car insurance, it’s important to know what the numbers on your car insurance policy mean so you know how much liability insurance coverage your policy includes. Understanding the auto insurance numbers is easy: The numbers 25/50/10 define the car insurance coverage limits and refer to the amounts of coverage for three different buckets, in the thousands.
So, the first number refers to the bodily injury for one person ($25,000 in this case), the second is for bodily injury liability for all people injured in one accident ($50,000) and the third is for property liability damage per accident ($10,000).
Keep reading for a breakdown of these car insurance numbers.
- The numbers 25/50/10 on your car insurance policy represent the limits of your liability coverage and signify the max amount your policy will pay out.
- These numbers refer to the max amount of liability coverage your insurance policy will pay out.
- When you have low limits on your car insurance, if something happens and you cause a lot of damage you will be responsible for the remainder.
What do the car insurance numbers represent?
Different car insurance numbers show different liability coverage limits. These numbers on your auto insurance policy represent the monetary limits on your liability coverage.
They represent a split-limit policy, which means the numbers are split between bodily injury liability, bodily injury liability per accident and property damage liability coverage. If you had a combined single limit policy, all the damages/injury costs would come out of one combined limit.
The car insurance numbers may look like this:
- 25/50/10
- 50/100/50
- 100/300/100
Let’s take 25/50/10 as an example:
- The first number, 25, stands for a limit of $25,000. This is your maximum coverage for bodily injury liability for one person injured in one accident or incident.
- The second number, 50, stands for a limit of $50,000. This is your maximum coverage for bodily injury liability for all persons injured in one accident.
- The third number, 10, stands for a limit of $10,000. This is your maximum coverage for property damage liability in an accident you caused.
Which policy number format does State Farm use?
State Farm, like other insurance companies, uses the same policy number format of bodily injury (BI) liability per person/BI liability for all persons in an accident/property damage. So, for example, 100/300/100 is $100,000 bodily injury liability for one person, $300,000 BI per accident and $100,000 in property damage.
Do you need to have liability insurance?
Every state except New Hampshire requires drivers to have minimum liability coverage before they can operate a vehicle. This policy protects you against certain financial losses if you are involved in an at-fault accident. It will cover bodily injury and property damage you cause to others up to the limits of your policy.
Liability car insurance is your primary coverage that helps to pay for the damage you’ve caused to other people and their property in an accident. The two types of auto liability coverage are bodily injury and property damage. In most states, drivers are required to have both coverages.
Bodily injury liability coverage
The first two numbers represent the highest monetary amount your insurance company will pay if someone is injured in an accident for which you’re at-fault.
For example, if you injure one driver in an at-fault accident and your limit is $10,000, your insurance company will pay up to $10,000 for that person’s medical bills. If the bills come out to $12,000, for example, you will be required to pay an extra $2,000 out of pocket.
If you have a limit of $20,000 and you’re at fault in an accident where four people hurt, the most any one person can get for their medical bills is $10,000. So all four would have to split the $20,000 top limit.
If one person was severely injured, that individual’s medical expenses could easily exceed your per-person limit of $10,000 for bodily injury liability — meaning you’d be responsible for the excess medical bills your insurance didn’t pay.
With one party already receiving $10,000 in this example, the medical bills for the other three parties would be paid out of the remaining $10,000 left on your bodily injury coverage. If the total of their medical expenses also exceeded your limit, they also could come after you personally for this money.
Property damage liability coverage
If your property damage limit is $10,000 and you hit several cars in an accident, you would exceed the $10,000 property damage liability limit. If you totaled two cars, each worth $8,000, the other parties would have at least $16,000 worth of claims, exceeding your property damage liability limits of $10,000 — you would be on the hook for the remaining $6,000.
Read more: What is property damage liability coverage?
How much liability coverage should you buy?
The state’s minimum liability requirements are enough to register your vehicle and remain legally compliant. However, they’re extremely low and provide very little financial protection.
Low limits leave you and your assets at risk; you can be held personally responsible for amounts exceeding your car insurance limits. CarInsurance.com editors recommended that you buy as much car insurance as you can afford.
How much car insurance do I need to carry?
It’s important to get the right liability coverage limits for your car. All states have minimum legal requirements that all drivers should meet, but how much insurance you need to carry will depend on your current assets as well as the state you live in.
And if you purchased your vehicle with an auto loan, you must carry comprehensive and collision coverage as well.
If you have a high risk of being involved in accidents and are financially secure, you should carry higher limits on your liability coverage. It also lowers the risk of losing your assets if a lawsuit is filed against you.
To see how much liability limits you should buy, see how much car insurance you need.
What does 100/300/100 mean?
The insurance industry’s recommended coverage amount is 100/300/100: $100,000 per person and $300,000 per incident for bodily injury and $100,000 for property damage liability coverage.
Is 100/300/100 better than 25/50/25?
Yes — liability coverage with limits of 100/300/100 provides a much higher level of liability coverage than a policy with limits of 25/50/25.
The bottom line on car insurance numbers
Selecting a policy with limits that are too low puts yourself at risk financially. To make payments for injuries or damages that exceed your limits, you could be forced to liquidate property, savings and other assets, or your future earnings could be attached.
By purchasing liability limits to account for your current assets and future net worth, you can help protect yourself against this risk.
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Laura Longero
Executive Editor
Laura Longero is an insurance expert and Executive Editor at CarInsurance.com, where she specializes in helping consumers navigate the complexities of the financial and insurance industries. She has 15 years of experience educating people about finance and car insurance. Prior to joining CarInsurance.com, she worked as a reporter and editor at the USA Today Network. Her expertise provides readers with practical guidance, helping them make informed choices about their financial and insurance needs.
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John McCormick
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Leslie Kasperowicz
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Leslie Kasperowicz is an insurance educator and content creation professional with nearly two decades of experience first directly in the insurance industry at Farmers Insurance and then as a writer, researcher, and educator for insurance shoppers writing for sites like ExpertInsuranceReviews.com and InsuranceHotline.com and managing content, now at CarInsurance.com.
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