Car Liability Insurance: Part II – What Does It Cover?

Liability insurance covers claims against the policyholder and other operators of the policyholder’s vehicle that do not reside in the same home as the policyholder, or are not specifically excluded on the policy. Potential drivers living at the same address must be named individually on the policy. If the policyholder gets married or a family member reaches legal driving age, for instance, they must then be added on to the policy.

For the most part, a policyholder’s liability insurance does not protect them if they operate a vehicles that is not their own, in which case they are generally covered under that party’s policy (providing, of course, they have one). Liability coverage usually extends to rented vehicles, but in most cases only liability applies. Additional coverage like comprehensive policies (“full coverage”) might not apply. Most rental car companies will offer renters liability insurance to cover any damage sustained by the vehicle.