Cheapest liability car insurance in 2024: Budget friendly coverage

Liability insurance covers injuries and property damage you cause to others when you're at fault in an accident.

With liability car insurance, you don’t gain any protection for your own vehicle or injuries, but you do get coverage for damage or injuries you inflict upon others when you're at fault in an accident. For example, if you hit and wreck someone else’s car, your liability insurance will pay for their repairs or replacement. However, coverage limits for liability car insurance can vary significantly.

We found that on average, a 40-year-old driver of a 2023 Honda Accord LX with a clean driving record who drives 10,000 miles per year can expect to pay $647 annually for liability-only car insurance with coverage limits of $50,000 per person/$100,000 per accident for bodily injury and $50,000 per occurrence for property damage. That’s about $55 per month.

But some insurers offer even better rates. We found that, of the major national carriers, Geico offers the cheapest liability coverage, with a national average of $47 a month. Travelers isn't too far behind, offering coverage for $53 a month.

And there’s a good chance, depending on where you live, that you can find cheaper liability insurance. 

In this guide, we’ll explore how rates differ from company to company and from state to state and help you find the best deal that balances cost and risk.

Cheapest liability car insurance companies

While it’s important to find reliable car insurance that you can count on to provide financial protection, you don’t want to overpay. Car insurance rates vary based on factors such as coverage limits, age, driving record, and location, among others, yet there can also be significant differences in the cost for the same coverage among different car insurance companies.

If you want to find the cheapest liability car insurance companies, a good place to start is by considering companies that fall below the national average of $647 a year or $54 a month. 

Some car insurance companies offer better rates in certain states, while some only operate in select areas. The rates below were collected from auto insurance comparison site CarInsurance.com and its data partner Quadrant Information Services for single, 40-year-old male and female drivers of a 2023 Honda Accord LX with a good insurance score and no violations on their record for full coverage insurance policy with liability limits of 100/300/100 and a $500 comprehensive and collision deductible.

Cheapest companies for liability auto insurance across the states

The table below shows the cheapest company for liability auto insurance in each state.

Almost every state requires drivers to carry liability car insurance, but the limits differ from state to state, and in many cases, these limits aren’t enough to financially protect drivers.

“If your insurance falls short in covering damages from a car accident, you might face legal action, jeopardizing your personal assets,” says Steve Rivera, partner and private client practice leader at The Liberty Company Insurance Brokers.

That’s because you can be held personally liable for injuries or damage that exceed your insurance coverage limits, so you don’t necessarily want the bare minimum coverage. Instead, you might want to pay a little more for added protection.

Understanding liability car insurance coverage — key terms you should know

Liability car insurance falls into two primary categories:

Bodily injury (BI): Bodily injury liability coverage pays for costs associated with injuries or death you cause to others in a car accident. These costs can include medical bills and funeral expenses.

Property damage (PD): Property damage liability coverage pays for costs associated with damage to other vehicles, houses, or any other type of physical property that’s damaged by your actions.

Liability car insurance typically provides different coverage limits for BI and PD. BI coverage includes per-person and per-accident limits, such as $25,000 per person and $50,000 per accident. In other words, if you get into an accident and injure two passengers in another vehicle, your liability insurance could pay up to $25,000 in bodily injury claims for each of them.

But, if a third passenger were injured, they wouldn’t each be eligible for $25,000 in payments, as that would exceed the per-accident limit. Instead, the $50,000 would potentially be divided among the three injured passengers in the other vehicle, and you could be personally liable for what’s not covered by insurance.

Property damage coverage applies per occurrence. So, if you have a $25,000 per accident limit for property damage and crash into two cars, the two other drivers wouldn’t each be eligible for $25,000 in damages. Instead, they could be awarded damages out of the overall $25,000 pool, which might not necessarily cover the full extent of the damage, meaning you could be personally liable for uncovered amounts.

These coverage limits are typically expressed as three numbers, such as 25/50/25, meaning $25,000 in bodily injury per person, $50,000 in bodily injury per accident, and $25,000 in property damage per occurrence.

Bare minimum insurance requirements across the states

All states other than New Hampshire require at least some level of liability insurance, and if certain financial requirements are not met, then New Hampshire drivers could also need liability insurance.

But while lower limits typically coincide with lower premiums, that might not be a risk you want to take. You could be personally liable for damages that exceed your limits.

Also, some states have no-fault insurance laws, meaning even if you cause an accident, the victim would have to first file a claim with their own insurer for injuries.

However, that still doesn’t mean you should necessarily choose the minimum required coverage because if the accident causes damages or injuries that exceed their policy limits, you could be held liable.

Furthermore, property damage is not part of no-fault coverage, and you are still liable for any damage you cause. To see the minimum liability insurance coverage requirements in your state, search the table below.

Navigating state minimums vs. recommended coverage

Carrying the minimum required coverage is often a matter of being penny-wise and pound-foolish. In other words, you might save a little bit of money now in premiums, but you’re putting yourself at far greater risk to pay more money in the long run.

“If you purchase the state minimum coverage you likely are going to be out of pocket thousands to tens of thousands of dollars if you are at fault in an accident,” says Ted Olsen, vice president at Goosehead Insurance.

Typically, premium costs aren’t much more for higher liability limits — often only $20 to $30 more per month to go from minimum to maximum limits, Olsen says.

Yet the difference for your long-term personal finances and peace of mind can be dramatic.

Thus, many experts recommend buying at least enough liability coverage to match your personal assets. Otherwise, if you cause an accident that exceeds your coverage limits, you could lose assets, like your home, in a lawsuit.

But even if you don’t have many assets yet, buying more than the minimum required coverage can still be wise.

“The reality is that when found liable you can be responsible for a judgment that is settled over time. There are cases where wages are garnished when the immediate funds are unavailable. Given all of these factors, it’s best to purchase as much liability protection as you can,” Olsen says.

See the table below for a cost comparison of state minimum required coverage vs. 50/100/50 liability coverage limits based on a sample policy.

Liability insurance cost

Liability insurance costs vary significantly from state to state, based on risk factors like local regulations and the accident rates within a particular state. Search the table below to see how liability car insurance costs in your state compare to the national average based on a sample policy.

Factors influencing the cost of your liability coverage

In addition to differing by state, liability car insurance rates can depend on several factors, such as your:

• Coverage limits
• Deductibles
• Age
• Driving record
• Type/value of vehicle
• Vehicle safety features
• Vehicle usage
• Credit history

These are just some of the many factors that go into calculating insurance premiums. Different insurers have different criteria and weighting systems to determine rates, and states also differ in their regulation of what can be used to calculate car insurance rates.

Choosing the right liability insurance

Choosing the right liability insurance depends on factors like how much coverage you want and where you can get the best rates.

Keep in mind that the cheapest liability car insurance company for one set of policy limits doesn’t necessarily mean that the company has the best rates in every scenario. Compare car insurance quotes based on your needs to find the cheapest liability car insurance company that still provides enough coverage.

Comparing liability insurance providers

When comparing liability insurance providers, cost is only part of the equation. Consider other factors, such as customer reviews. It could be worth it to pay slightly more for a company you’re confident will do a good job fighting on your behalf if someone makes a claim against you.

Also, consider how liability insurance providers compare for other types of car insurance coverage. You might decide to get car insurance that includes not only liability coverage but also other protections like collision coverage and medical payments coverage to protect your own car and pay for your own medical bills in the event of an accident.

Some drivers prefer to buy car insurance from a company they have other forms of coverage with, such as a renters or homeowners policy, to obtain a bundling or multipolicy discount and to make managing finances easier by going through one provider.

Customizing your liability insurance policy

Note that the average liability insurance policy doesn’t have to be the one you choose, nor do you have to stay put with the same insurance coverage you’ve always had. You can typically make adjustments for greater protection, such as increasing coverage limits while holding the policy, even if you haven’t changed vehicles.

Other examples include gap insurance — which can pay for the difference between your vehicle’s insured value and the amount you have on your car loan if the vehicle becomes totaled — as well as uninsured/underinsured motorist coverage, which can help cover the difference between what another driver would ordinarily be liable for and what your damages are if they cause an accident that they can’t pay for.

Tailored strategies for every driver — Insider tips from the experts

Finding the best liability car insurance can vary based on your situation. Consider the following types of scenarios to see what could make sense for your own situation. 

The young driver looking for savings

Young drivers often face high insurance rates, but there are ways to save money, starting with choosing a lower-cost, reliable vehicle with lower premiums. You can also find many discounts to bring down these otherwise high costs.

“For young drivers, the family policy route is often the budget-friendly option for purchasing insurance coverage. Piggyback on your parents' policy and unlock discounts for good grades, safe driving courses, and telematics programs,” Rivera says. “Also, consider a higher deductible to trim premiums, but make sure it's a number you can handle if you need to cash in.”

The budget-conscious family

Budget-conscious families can take several steps to reduce car insurance costs, starting with maintaining a clean driving record among family members.

“Budget-savvy families can tailor their insurance approach by adjusting deductibles for different drivers/autos. Bundling various coverage lines can unlock multi-policy discounts. In addition, it's important to periodically review and adjust coverage wisely, ensuring adequate liability protection while tweaking other policy elements, like collision or comprehensive, to fit the family's budget,” Rivera says.

“Lastly, regularly reviewing and revisiting your policies as circumstances change helps avoid overpayment, which none of us tend to enjoy,” he says.

The city dweller minimizing insurance costs

If you live in a city, you might not drive frequently. So, you might explore ways to reduce insurance costs – such as a liability-only policy. But there are other ways to save.

“City dwellers who don't frequently hit the road should explore telematics programs monitoring annual mileage. This not only provides discounts but also encourages maintaining lower mileage levels,” Rivera says.

“Investigate low-mileage discounts offered by insurers and weigh the cost savings of opting for higher deductibles, since infrequent driving lowers the associated risks. Remember, even for those driving less often, maintaining adequate liability coverage remains crucial to protect against potentially high costs associated with accidents,” he says.

You can also potentially obtain lower rates by installing anti-theft devices and parking in a garage rather than on the street.

Individuals with older vehicles

If you have an older car, it might not be worth much, which could reduce the value of having comprehensive and collision coverage. In that case, you might look for the cheapest liability-only car insurance.

“Be sure to check a variety of insurers when looking to insure an older car. Some insurance programs will give discounts based on how often or how aggressively you use your vehicle through telematics programs. There are also programs that allow you to save some money if the vehicle is only used seasonally,” Olsen says.

Drivers with a clean record

Lastly, drivers with a clean record can often score discounts, but insurers can differ in terms of how they reward safe drivers.

“Clean driving records will provide some of the best pricing in the insurance market. Some insurers cater more to those drivers with deeper discounts, while others cater more to a more common driving record that has one or two incidents there. Different providers also differ on how far back they look at your driving history. Depending on how long you’ve had a clean driving history, you can find a provider that will provide you with a rate that is specific to your case,” Olsen says.

“It's also important that you look into telematics programs. These programs will measure how safe you drive through mileage reporting, braking habits, etc. If you are a safe driver, it’s one of the largest discounts available and can save you quite a bit of money,” he says.

Transitioning from comprehensive to liability-only

Some drivers may choose to reduce their coverage, eliminating comprehensive and collision coverage and going with liability-only car insurance. For instance, if their vehicle isn’t worth much, the car owner may see paying for additional insurance as an unnecessary expense.

“If I choose not to have comprehensive or collision on my vehicle, I am essentially choosing not to insure my car. Liability protects others, the comprehensive and collision protects my car. If I’m comfortable with paying out of pocket to repair or replace my car if something happens to it, then that’s when I start looking at removing those two coverages,” Olsen says.

That said, don’t automatically assume this extra insurance is too expensive for your situation. Compare quotes to see what makes sense.

“What I’ve found is that once the car is old enough to consider removing the coverages, the insurer actually no longer charges very much to include them given the reduced value of the car, so be sure to check on the savings before removing the coverage,” Olsen says.

“If I’m looking for a policy to replace the one I have, it’s always best to check a few options to make sure you are getting good value. One insurer that has good value with comprehensive and collision might be less of a good option with liability only. An independent agent can check multiple sources for you,” he says.

See the table below to compare the costs of full coverage (50/100/50) with comprehensive and collision vs. liability-only car insurance (50/100/50) without comprehensive and collision.

Resources & Methodology

Sources

• LibertyMutual.com. "The Liberty Company Insurance Brokers." Accessed August 2024.
• Goosehead.com. "Goosehead Insurance." Accessed August 2024.

Methodology

Editors collected rate information from auto insurance comparison site CarInsurance.com and its data partner Quadrant Information Services for single, 40-year-old male and female drivers of a 2023 Honda Accord LX with a good insurance score and no violations on their record for full coverage insurance policy with liability limits of 100/300/100 and a $500 comprehensive and collision deductible.

We analyzed more than 53 million quotes, more than 34,000 ZIP codes and 170 insurance companies nationwide.

Note: 100/300/100 means up to $100,000 for the medical bills of those you injure, up to $300,000 per accident for bodily injury liability for all persons injured in one accident, and $100,000 to repair other drivers’ cars and property that you damage.