How to Choose Car Liability Limits Above the Legal Minimum

Liability coverage levels compared

Why state minimums are not enough

Every US state except New Hampshire mandates minimum liability insurance, but those minimums were set decades ago and haven't kept pace with medical costs or vehicle prices. California's minimums hadn't changed since 1967 until they increased in 2025 to 30/60/15. Even at the new level, $30,000 per person barely covers an emergency room visit and one night of hospital care, let alone surgery, rehabilitation and lost wages.

Property damage minimums are equally inadequate. The average new car transaction price in the US now exceeds $48,000. A $15,000 or $25,000 property damage limit means you're personally responsible for the difference if you total someone's car.

The real risk: if your liability limits are exhausted, the injured party can sue you for the remainder and pursue your savings, home equity and future wages.

Understanding the numbers: split limits vs CSL

Most auto liability policies use split limits: three numbers written as, for example, 100/300/100.

1. First number (bodily injury per person): maximum paid for any single person's injuries in an accident you cause. At 100/300/100 this is $100,000.
2. Second number (bodily injury per accident): maximum paid for all injuries in a single accident, regardless of how many people. At 100/300/100 this is $300,000.
3. Third number (property damage per accident): maximum paid to repair or replace property (vehicles, fences, buildings) you damage. At 100/300/100 this is $100,000.

Some policies offer a combined single limit (CSL) — a single pot of money that can be applied in any combination. CSLs are flexible but often more expensive.

The 100/300/100 recommendation: why it's the sweet spot

Insurance professionals and consumer advocates consistently recommend 100/300/100 as a sensible minimum for most drivers. At this level:

1. Most serious accident injuries — including surgery and short-term rehabilitation — fall within $100,000 per person.
2. Multi-person accidents (four people in the other vehicle) are covered up to $300,000 total.
3. You can replace any car currently on the market with $100,000 in property damage coverage.

The premium difference between state minimums and 100/300/100 is often $100–$200 per year — a few hundred dollars to add protection against a $500,000 lawsuit.

When to go higher: umbrella policies

Consider going beyond 100/300/100 (or adding an umbrella) if:

1. You have significant assets (savings, home equity, investments) that a lawsuit could target.
2. You drive frequently, have a long commute or drive for business.
3. You have young or inexperienced drivers on your policy.
4. You live in a state with a litigious legal environment.
5. You drive a high-powered vehicle with higher accident-severity potential.

Property damage: the forgotten number

Drivers often focus on bodily injury limits and overlook property damage. With new cars regularly priced at $40,000–$80,000+ and luxury vehicles well above that, a property damage limit of $25,000 is seriously exposed. A 100/300/100 policy's $100,000 property damage limit handles most scenarios; dropping to 100/300/50 saves little and leaves meaningful exposure.