WHAT IS LIABILITY COVERAGE?       If you are involved in an accident and someone else is injured, the injured person may make a claim against you for monetary compensation. If a judge or jury finds that you caused the accident (in whole or in part), then you may be held responsible to pay monetary damages to the injured person including medical expenses, loss of income and pain and suffering.     

     You may protect yourself from having to pay a claim by purchasing liability insurance. If you do so, your insurance company will pay any monetary damages that you are required to pay up to your policy limit -- the amount of liability insurance that you purchased. In addition, your insurance company will provide a lawyer to represent you if you are sued by someone else who is injured.     

     The law of the State of New Jersey requires you to purchase liability insurance for bodily injury in the minimum amount of $15,000 per person/$30,000 per accident. This means that your insurance company will pay up to $15,000 to any one person who is injured as a result of your negligence (carelessness). If more than one person is injured, your company will pay up to $30,000 per accident. In addition, you are required to purchase property damage liability insurance in the amount of $5,000 if you cause damage to someone else's property.     

     Remember, the law requires you to purchase an automobile insurance policy with liability coverage. If you fail to do so, you may be personally responsible to pay for the damages sustained by a person who is injured in an accident caused by you. This means that your personal assets will be at risk. A sheriff could execute a levy to seize your assets and the court could garnish your income so that money will be deducted from your wages. A judgment is valid for 20 years so that even your future assets may be seized. 

     The minimum liability limits of $15,000 per person/$30,000 per person are inadequate to protect your assets if you are sued. Most people purchase liability limits of $100,000 per person/$300,000 per accident. I recommend that you purchase liability limits of $500,000 single limit.

WARNING: ALWAYS PURCHASE LIABILITY INSURANCE FOR YOUR CAR.