Property damage liability insurance is an auto liability coverage that pays for a driver's damage to another person's property. Property damage liability insurance pays for repairs to other cars, fences, buildings, and utility poles. At-fault crashes create three main financial risks: repair bills, loss-of-use claims, and lawsuits above the policy limit. According to the National Safety Council, approximately 9.7 million crashes involved property damage or non-disabling injuries in 2024. State minimum property damage limits range from $5,000 to $50,000 per accident across the United States. Insurance Navy helps drivers find the right insurance at the right price. This guide explains property damage liability insurance coverage, state minimums, costs, and claims.
Table of contents
- What is Property Damage Liability?
- How does Property Damage Liability work?
- What Does Property Damage Liability Cover?
- What Property Damage Liability Does Not Cover
- How Much Property Damage Liability Coverage Do You Need?
- How Much Does Property Damage Coverage Cost?
- How Do You File a Property Damage Liability Claim?
- Frequently Asked Questions
- Is Property Damage Liability Insurance Required by State Law?
- What’s the difference between Property Damage and Collision Coverage?
- What’s the difference between Physical Damage Coverage and Property Damage?
- Does Umbrella Insurance Cover Property Damage from a Car Accident?
What is Property Damage Liability?
Property damage liability is the part of your car insurance that pays for damage you cause to someone else's property. Property damage liability does not pay to fix your own car.
Property damage liability is the third number in a split limit. In a 25/50/20 policy, the 20 means the policy pays up to $20,000 per accident for property damage. Each state sets its own minimum property damage limit.
Property damage coverage protects your personal assets.
If you are in an accident and are responsible for property damage, you are legally required to pay the other party. Property damage liability allows the other party to go to your insurance company to get paid instead of you paying out of pocket.
How does Property Damage Liability work?
Property damage liability is part of the liability coverage in your auto policy. Bodily injury liability pays for medical bills for injuries you cause, property damage liability pays for the cost of repairing damaged property.
The property damage liability limit is the maximum amount your insurance company pays for damages from a covered claim. Your declarations page lists your property damage liability limit.
Most policies have split limits which have separate amounts for bodily injury liability insurance and property damage coverage. For example a 100/300/100 split limits means:
$100,000 per person for bodily injury liability
$300,000 per accident for bodily injury liability
$100,000 per accident for property damage
In this case, your insurance company pays up to $100,000 for property damage in 1 accident. If the property damage costs more than $100,000, you pay the difference.
Or a combined single limit policy has one total limit for both bodily injury coverage and property damage coverage.
A $300,000 combined single limit means your insurance company will pay up to $300,000 for all damages, both property damage and bodily injuries, for one at-fault accident.
What Does Property Damage Liability Cover?
According to the National Association of Insurance Commissioners (NAIC), property damage liability "pays for damages you cause to someone else's car or objects and structures you hit with your car." The property damage limit applies per accident. All the property you damage in 1 crash shares the same limit. Property damage liability pays for 5 types of loss:
Repairs to the other driver's car - Property damage liability pays for parts and labor at the repair shop.
Other property you hit - Property damage liability pays for damage to fences, mailboxes, buildings, street signs, and utility poles.
Legal defense - If the property owner sues you over the damage, your insurer provides your legal defense.
Lost business income - If your car damages a business and the business must close for repairs, the owner's lost income can be part of the claim.
Loss of use - The policy definition of property damage includes loss of use of the damaged property.
What Property Damage Liability Does Not Cover
Property damage liability does not pay for 4 types of loss:
Damage to your own car - Collision coverage pays for damage to your own car after a crash.
Theft, fire, or weather damage to your car - Comprehensive coverage pays for theft, fire, and weather damage to your car.
Injuries to other people - Bodily injury liability pays for injuries you cause to other people.
Damage above your limit - Property damage liability stops paying at your limit. According to the Insurance Information Institute (III), an umbrella policy "kicks in when you reach the limit on the underlying liability coverage."
How Much Property Damage Liability Coverage Do You Need?
At a minimum, you need your state's required property damage liability limit. The required limit is $15,000 in California, $20,000 in Illinois and Nevada, and $25,000 in Texas, Indiana, and Georgia.
The state minimum is the lowest legal limit, not a recommended limit. A crash that totals a newer car or damages 2 or more cars can cost more than the state minimum. The NAIC advises drivers who could not pay large costs out of pocket to carry more than the state minimum. A 50/100/50 policy raises the property damage limit to $50,000.
If you lease or finance your car, check your contract. Lenders and leasing companies often require higher liability limits than the state minimum.
The state mandated car insurance requirements are listed in the table below.
| State | Requirements |
|---|---|
| Alabama | $25,000 BIL per person $50,000 BIL per accident $25,000 PDL per accident |
| Alaska | $50,000 BIL per person $100,000 BIL per accident $25,000 PDL per accident (Insurance is not required in areas where vehicle registration is not required, except for drivers with a violation of 6 points or more in the last 5 years.) |
| Arizona | $25,000 BIL per person $50,000 BIL per accident $15,000 PDL per accident |
| Arkansas | $25,000 BIL per person $50,000 BIL per accident $25,000 PDL per accident |
| California | $30,000 BIL per person $60,000 BIL per accident $15,000 PDL per accident (for policies issued or renewed on or after January 1, 2025) |
| Colorado | $25,000 BIL per person $50,000 BIL per accident $15,000 PDL per accident |
| Connecticut | $25,000 BIL per person $50,000 BIL per accident $25,000 PDL per accident $25,000 UM/UIM per person $50,000 UM/UIM per accident |
| Delaware | $25,000 BIL per person $50,000 BIL per accident $10,000 PDL per accident $15,000 Personal injury protection (PIP) per person $30,000 Personal injury protection (PIP) per accident |
| Florida | $10,000 PDL per accident $10,000 Personal injury protection (PIP) |
| Georgia | $25,000 BIL per person $50,000 BIL per accident $25,000 PDL per accident |
| Hawaii | $20,000 BIL per person $40,000 BIL per accident $10,000 PDL per accident $10,000 Personal injury protection (PIP) |
| Idaho | $25,000 BIL per person $50,000 BIL per accident $15,000 PDL per accident |
| Illinois | $25,000 BIL per person $50,000 BIL per accident $20,000 PDL per accident $25,000 UM per person $50,000 UM per accident |
| Indiana | $25,000 BIL per person $50,000 BIL per accident $25,000 PDL per accident |
| Iowa | $20,000 BIL per person $40,000 BIL per accident $15,000 PDL per accident |
| Kansas | $25,000 BIL per person $50,000 BIL per accident $25,000 PDL per accident $25,000 UM/UIM per person $50,000 UM/UIM per accident PIP: $4,500 Medical, $900/Month for 1 year disability/loss of income, $25/Day in-home services, $2,000 Funeral costs, $4,500 Rehab. Survivors: $900/Month for 1 year disability/loss of income, $25/Day in-home services. |
| Kentucky | $25,000 BIL per person $50,000 BIL per accident $25,000 PDL per accident |
| Louisiana | $15,000 BIL per person $30,000 BIL per accident $25,000 PDL per accident |
| Maine | $50,000 BIL per person $100,000 BIL per accident $25,000 PDL per accident $50,000 UM/UIM per person $100,000 UM/UIM per accident $2,000 Medical payments coverage (MedPay) Single liability limit per accident of $125,000 |
| Maryland | $30,000 BIL per person $60,000 BIL per accident $15,000 PDL per accident $30,000 UM/UIM per person $60,000 UM/UIM per accident $15,000 UM/UIM PDL per accident |
| Massachusetts | $25,000 BIL per person $50,000 BIL per accident $30,000 PDL per accident $25,000 UM per person $50,000 UM per accident $8,000 Personal injury protection (PIP) (policies on or after July 1, 2025) |
| Michigan | $50,000 BIL per person $100,000 BIL per accident $10,000 PDL per accident outside Michigan $10,000 Property damage outside MI $1M Property protection in MI $250,000 PIP ($ Lower for some Medicare/Medicaid). |
| Minnesota | $30,000 BIL per person $60,000 BIL per accident $10,000 PDL per accident $25,000 UM/UIM per person $50,000 UM/UIM per accident $40,000 Personal injury protection (PIP) |
| Mississippi | $25,000 BIL per person $50,000 BIL per accident $25,000 PDL per accident |
| Missouri | $25,000 BIL per person $50,000 BIL per accident $25,000 PDL per accident $25,000 UM per person $50,000 UM per accident |
| Montana | $25,000 BIL per person $50,000 BIL per accident $20,000 PDL per accident |
| Nebraska | $25,000 BIL per person $50,000 BIL per accident $25,000 PDL per accident $25,000 UM/UIM per person $50,000 UM/UIM per accident |
| Nevada | $25,000 BIL per person $50,000 BIL per accident $20,000 PDL per accident |
| New Hampshire | $25,000 BIL per person $50,000 BIL per accident $25,000 PDL per accident $25,000 UM/UIM per person $50,000 UM/UIM per accident $25,000 UM/UIM PDL $1,000 Medical payments coverage (MedPay) (Liability insurance is not compulsory in New Hampshire.) |
| New Jersey | Standard Policy: $35,000 BIL per person $70,000 BIL per accident $25,000 PDL per accident $15,000 Personal injury protection (PIP) (policies on or after January 1, 2026). Basic Policy: $5,000 PDL per accident $15,000 Personal injury protection (PIP). Bodily injury liability is optional ($10,000) on the Basic Policy. |
| New Mexico | $25,000 BIL per person $50,000 BIL per accident $10,000 PDL per accident |
| New York | $25,000 BIL per person $50,000 BIL per accident $50,000 Liability coverage for death per person $100,000 Liability coverage for death per accident $10,000 PDL per accident $25,000 UM BIL per person $50,000 UM BIL per accident $50,000 Personal injury protection (PIP) |
| North Carolina | $50,000 BIL per person $100,000 BIL per accident $50,000 PDL per accident $50,000 UM per person $100,000 UM per accident $50,000 UMPD per accident (policies issued or renewed on or after July 1, 2025) |
| North Dakota | $25,000 BIL per person $50,000 BIL per accident $25,000 PDL per accident $25,000 UM/UIM per person $50,000 UM/UIM per accident $30,000 Personal injury protection (PIP) |
| Ohio | $25,000 BIL per person $50,000 BIL per accident $25,000 PDL per accident |
| Oklahoma | $25,000 BIL per person $50,000 BIL per accident $25,000 PDL per accident |
| Oregon | $25,000 BIL per person $50,000 BIL per accident $20,000 PDL per accident $25,000 UM per person $50,000 UM per accident $15,000 Personal injury protection (PIP) |
| Pennsylvania | $15,000 BIL per person $30,000 BIL per accident $5,000 PDL per accident $5,000 Medical benefits |
| Rhode Island | $25,000 BIL per person $50,000 BIL per accident $25,000 PDL per accident |
| South Carolina | $25,000 BIL per person $50,000 BIL per accident $25,000 PDL per accident $25,000 UM per person $50,000 UM per accident $25,000 UMPD |
| South Dakota | $25,000 BIL per person $50,000 BIL per accident $25,000 PDL per accident $25,000 UM/UIM per person $50,000 UM/UIM per accident |
| Tennessee | $25,000 BIL per person $50,000 BIL per accident $25,000 PDL per accident |
| Texas | $30,000 BIL per person $60,000 BIL per accident $25,000 PDL per accident |
| Utah | $30,000 BIL per person $65,000 BIL per accident $25,000 PDL per accident, or a $90,000 combined single limit. $3,000 Personal injury protection (PIP) (policies issued or renewed on or after January 1, 2025) |
| Vermont | $25,000 BIL per person $50,000 BIL per accident $10,000 PDL per accident $50,000 UM/UIM per person $100,000 UM/UIM per accident $10,000 UM/UIM-PD per accident |
| Virginia | Insurance is required. The $500 uninsured motor vehicle fee option ended July 1, 2024. $50,000 BIL per person $100,000 BIL per accident $25,000 PDL per accident. UM/UIM limits match the liability limits (policies effective on or after January 1, 2025). |
| Washington | $25,000 BIL per person $50,000 BIL per accident $10,000 PDL per accident |
| Washington, D.C. | $25,000 BIL per person $50,000 BIL per accident $10,000 PDL per accident $25,000 UM per person $50,000 UM per accident $5,000 UMPD per accident |
| West Virginia | $25,000 BIL per person $50,000 BIL per accident $25,000 PDL per accident $25,000 UM per person $50,000 UM per accident $25,000 UMPD |
| Wisconsin | $25,000 BIL per person $50,000 BIL per accident $10,000 PDL per accident $25,000 UM per person $50,000 UM per accident |
| Wyoming | $25,000 BIL per person $50,000 BIL per accident $20,000 PDL per accident |
To avoid paying out of pocket, carry enough property damage liability to cover a serious crash. The average auto liability claim for property damage was $6,770 in 2024, up from $3,628 in 2015, according to the III. The National Safety Council puts the average economic cost of a property-damage-only crash at $6,600 per vehicle (2024 data). A serious crash costs more than these averages.
How Much Does Property Damage Coverage Cost?
Insurers do not sell property damage liability by itself. Insurers price property damage liability together with bodily injury liability as your liability coverage. The NAIC reports that the average U.S. liability premium was $813.27 in 2024, up from $736.43 in 2023. The NAIC does not publish a separate average premium for property damage liability.
Your property damage liability price depends on 3 main factors:
The limit you choose - A higher property damage limit costs more.
Your driving record - A recent speeding ticket or at-fault accident raises your premium. Insurers set premiums based on driving risk.
Your state - Average liability premiums vary by state. In 2024, the NAIC average liability premium was $523.18 in Indiana, $649.14 in Illinois, $760.49 in California, $892.78 in Texas, $1,187.17 in Georgia, and $1,195.77 in Nevada.
How Do You File a Property Damage Liability Claim?
A property damage liability claim is a third-party claim. The person whose car or property you damaged files the claim against your policy. Your insurer pays that person.
If you caused the damage, take these 5 steps:
Call your insurer right away - The III advises drivers to call their insurer as soon as possible, even from the accident scene, no matter who is at fault.
Exchange information with the other driver - Write down the other driver's name, phone number, insurance company, policy number, and vehicle make and model.
Get a copy of the police report - Your insurer usually asks for a proof-of-claim form and a copy of the police report, if police filed a report.
Photograph the damage and the scene - Photos help the claims adjuster confirm what your car hit and how much damage the crash caused.
Let the claims adjuster handle the claim - Your insurer's claims adjuster reviews the other party's damage and pays the other party, up to your property damage limit.
If someone else damaged your car or property, file the claim with the at-fault driver's insurance company. The at-fault driver's insurer reviews your damage and pays up to the at-fault driver's property damage limit. If your damage costs more than that limit and you carry collision coverage, your own policy can pay the rest, minus your deductible.
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