Deductibles & limits
Liability Limits Explained: How to Read 100/300/100 and Choose Yours
Quick answer
Liability limits such as 100/300/100 mean your insurer pays up to $100,000 for each injured person, $300,000 for all injuries in one accident and $100,000 for property damage. A combined single limit uses one total instead. Anything above your limits can fall on you, which is why state minimums can be risky.
Key takeaways
- 100/300/100 means $100,000 per injured person, $300,000 per accident for injuries and $100,000 for property damage.
- A combined single limit is one total that covers injuries and property damage together.
- If damages exceed your limits, you can be personally responsible for the difference.
- Choose limits based on what you could lose, such as savings, home equity and future income.
- An umbrella policy adds a layer of liability coverage above your auto and home limits.
Liability is the part of your policy that protects other people from you, and protects your savings from a lawsuit. It’s also the part most people look at least. The three numbers next to it on your declarations page decide how much your insurer will pay if you cause a crash, and what you might have to pay yourself.
What do the numbers 100/300/100 mean?
Most policies use split limits, written as three numbers in thousands of dollars. Taking 100/300/100 as the example:
| Number | What it covers | Limit |
|---|---|---|
| First (100) | Bodily injury, each person you injure | Up to $100,000 per person |
| Second (300) | Bodily injury, everyone injured in one accident | Up to $300,000 per accident |
| Third (100) | Property damage to others, such as cars, fences and buildings | Up to $100,000 per accident |
The per-person limit applies even when the per-accident total has room left. Here’s an illustrative case: you cause a crash that injures two people, one with $140,000 in damages and one with $30,000. The total, $170,000, is under the $300,000 accident limit, but the first person’s claim is capped at $100,000. The remaining $40,000 could become your responsibility.
Liability pays for the other side’s medical bills, lost wages and, depending on the state, pain and suffering, as well as your legal defense if you’re sued. It never pays for your own car or your own injuries.
What is a combined single limit?
Some policies use a combined single limit (CSL) instead: one number that covers all bodily injury and property damage from one accident. A $300,000 CSL, for example, could pay $250,000 to one injured person and $50,000 for a damaged vehicle, as long as the total stays within $300,000.
A CSL is more flexible because no single person or category is capped separately. It isn’t offered by every insurer, and it can cost more than split limits with similar totals. When you compare quotes, make sure you’re comparing the same structure, not a CSL against split limits.
Why can state minimum limits be risky?
Every state sets a minimum amount of liability coverage, and the amounts vary widely. Minimums are designed to make sure some money is available to injured people, not to protect your finances. A serious injury or a crash involving a newer vehicle can produce costs well beyond a low limit.
When that happens, the injured party can seek the difference from you directly. Depending on your state’s laws, that can reach your savings, other assets and future wages. Choosing a low liability limit to save money can be one of the costliest cuts on a policy, which is why it’s usually better to look at your deductibles and add-ons first.
How much liability coverage should you carry?
There’s no single right answer, but a few questions point you in the right direction:
- What could you lose? Add up savings, investments outside retirement accounts and home equity. Many drivers aim for limits at least that high.
- What do you earn? A high or growing income can be a target in a lawsuit even if your savings are modest.
- Who drives your cars? A teen or newly licensed driver on the policy raises the chance of a costly claim.
- How do you drive? Long daily commutes and busy highways mean more exposure.
- What does more cost? The extra cost of higher limits varies by insurer, so ask for prices at two or three levels.
Your liability limits also matter for another coverage. In many states, the uninsured motorist limits you can buy are tied to your liability limits; see our uninsured motorist guide for how they connect.
When does an umbrella policy make sense?
An umbrella policy adds a layer of liability coverage that sits above your auto and homeowners or renters policies, for example an extra $1 million. If a claim uses up your auto liability limit, the umbrella can pay the rest, up to its own limit. Umbrella policies may also cover some claims that your underlying policies don’t, depending on the wording.
Two points to know before shopping:
- Umbrella insurers usually require you to carry certain minimum liability limits on your auto and home policies first, so you may need to raise those as part of the package.
- Umbrella coverage tends to suit people with significant assets or income to protect, landlords, and households with teen drivers.
To estimate how different liability limits change your full coverage cost, try the cost calculator, then check a rate with your chosen limits at the rate check.
Frequently asked questions
What happens if the damages are higher than my liability limits?
Your insurer pays up to your limits, and the injured party can pursue you personally for the rest. That may lead to a settlement you pay yourself, a court judgment or, depending on state law, collection from savings or wages. Higher limits or an umbrella policy reduce that risk.
Does liability insurance cover other people driving my car?
Often, yes. Many policies extend liability to people you allow to drive your car occasionally, though rules differ for household members who aren’t listed and for excluded drivers. Coverage follows the car in many states, but terms vary, so check your policy and list everyone who drives regularly.
Are liability limits the same on every car on my policy?
Usually they are set per policy, so all cars share the same liability limits, while collision and comprehensive deductibles are set per vehicle. Some insurers allow different limits on different cars. Your declarations page shows how your own policy is structured.