Bodily Injury Liability

Bodily injury liability coverage pays for injuries you cause to other people in an at-fault accident. It covers the other party's medical bills, lost income during recovery, rehabilitation costs, and legal expenses if they sue you. It does not cover your own injuries or those of your passengers -- that is what personal injury protection or medical payments coverage handles.

Limits are written as two numbers: per-person and per-accident. A 100/300 limit means up to $100,000 for any one injured person and up to $300,000 total per accident regardless of how many people are hurt. A moderate crash injuring two people with $80,000 each in medical costs pays out $160,000 in total -- still under the per-accident cap. A crash with three people each claiming $120,000 hits the per-accident ceiling at $300,000 even though total damages are $360,000. You are personally responsible for the $60,000 gap.

State minimum bodily injury limits are dangerously low in most states. Georgia requires only $25,000 per person and $50,000 per accident. A moderate injury -- broken bones, emergency room visit, physical therapy, several weeks of missed work -- can easily reach $80,000. If you are at fault and your limit is $25,000, the injured party can sue you for the remainder and collect from your personal assets: savings, home equity, future wages.

Carrying 100/300 or 250/500 bodily injury limits costs only modestly more per year than state minimums, but the gap in protection is enormous. A personal umbrella policy can extend the coverage further for a few hundred dollars annually. This is the coverage that protects your financial life, not just your car.