There are over 6.8 million licensed drivers in North Carolina alone. The law requires them to have several types of automobile insurance. These include coverage for damage to drivers and their property.
Despite the legal requirements, at least 6.5% of drivers in North Carolina have no automobile insurance.
Other than high costs, one of the main reasons that drivers may not have the right insurance or any at all is the complexity of the average policy. The sheer amount of providers and types of coverage make choosing the right one difficult.
Death and injury are two common results of an auto accident, but property damage may be even more frequent. It includes damage to a vehicle, home, or any other form of personal property.
If your insurance policy doesn’t protect you in these circumstances, you could end up with high out-of-pocket costs and even face legal trouble. Read our guide to understand what’s included in property damage liability coverage and why you need it.
What Is Property Damage Liability Coverage?
All types of automobile insurance are agreements between drivers and insurance companies. You pay them a yearly premium in exchange for coverage, a guarantee that the company will pay for costs associated with theft, damage, and other issues.
There are several components of the average auto insurance policy. The declaration page lays out what vehicles are included, the types of coverage you have, how large of a deductible you’ll have to pay, and how long the policy lasts.
Several types of insurance may be included in your policy. It may include bodily injury, personal injury, comprehensive, and/or collision coverage.
When most drivers sign up for insurance for the first time, they imagine auto insurance as a way to pay for medical costs related to physical damage. What they have to remember is that auto accidents cause expensive damage to cars, homes, and other priceless possessions just as often. The right policy must cover these types of damage as well.
Property damage or PD coverage handles the cost if you damage property that doesn’t belong to you. Depending on the policy, this could include homes, cars, fences, mailboxes, and more. You must maintain it to be a legal driver.
Minimum coverage limits in North Carolina include:
- $30,000 of bodily injury coverage per person
- $25,000 of property damage liability coverage per person
- $30,000 per person and $60,000 per accident of uninsured motorist bodily injury coverage
- $25,000 of uninsured/underinsured motorist property damage coverage
Meeting the minimum requirements is the best way to stay legal and ensure you have enough coverage to handle the costs of any form of damage.
Why Do I Need It?
There are at least 281,685 traffic crashes in North Carolina alone every year. You may think it could never happen to you, but the statistics say otherwise.
Getting the right auto insurance policy is essential for two major reasons. It protects you from excessive bills in the event of an auto accident or similar incident and helps you avoid legal problems such as lawsuits and fines.
You’ll need to make sure you get enough property damage liability coverage. Purchasing the minimum amount will keep you legal, but a serious accident like a multi-vehicle collision or crashing into a luxury car will cost you much more and leave you paying out-of-pocket.
Consider your own assets as well when deciding how much property damage liability coverage you need. The more valuable your property is, the more insurance you need to protect it. The more assets you have, the more coverage you’ll need to protect them.
Meeting coverage limits for bodily injury, property damage, and uninsured/underinsured driver coverage is the best way to avoid legal issues. Exceeding the limits provides better protection but requires higher premiums.
North Carolina is a fault state. It places all the costs for bodily injury or property damage on the driver responsible for an auto accident. Victims can file a claim with their own insurance provider or a third-party claim with yours. They can also file a personal civil court lawsuit against you.
Property damage liability insurance can protect you against a lawsuit. Drivers are less likely to take you to court if your insurance company can compensate them for any damages.
Court proceedings aren’t the only potential repercussions of failing to meet minimum coverage limits. It’s illegal to drive in North Carolina without insurance, and the legal repercussions of doing so can be intense.
An accident is one of the most common times to be caught driving uninsured. If you do, you may be forced to pay fines, lose your right to drive, or even face criminal charges.
The amount you’ll pay when your insurance lapses depends on how many times it’s happened before. Fines for failing to maintain the proper amount of automobile insurance include:
- $50 restoration fees
- $50 for the first lapse
- $100 for the second lapse
- $150 for all other lapses
Other penalties that can come from an improper auto insurance policy include:
- Wage garnishment
- Citation on your driving record
- Suspended license
- Vehicle impoundment
- Jail time
The exact penalties and fines you’ll face depend on your driving history and the nature of the accident. You’ll pay more if it’s a serious incident and if you already have accidents on your record.
The best way to avoid financial and legal issues is to maintain the minimum amount of coverage. Going beyond the minimum will force you to pay higher premiums, but it can also lead to higher payments from your insurance company after an accident.
Where Can I Get Property Damage Liability Insurance?
Property damage liability coverage pays for damage you cause to another driver’s personal property.
North Carolina is a fault state. You must cover all costs if you’re responsible for an accident. This is why you need a strong auto insurance policy.
Don’t be one of the many drivers in North Carolina that fail to meet minimum automobile insurance requirements. Realize how much coverage you need and shop around for the best insurance company to provide it.
Amistad Insurance Services provides insurance for businesses, automobiles, and everything you need to protect. Get an auto insurance policy today.