Property Damage Liability

Property damage liability insurance is a specific type of auto insurance that helps you pay for the damages you caused to other people's property in an accident that was deemed to be your fault. Having property damage liability insurance is mandatory in most states, with different coverage requirements from one state to another. The two types of liability coverage that your insurance policy must include as an Illinois driver are:

  • Property damage: Covers you financially for any damages you cause to other vehicles or objects
  • Bodily injury: Covers you financially for any expenses, medical or otherwise, that occurred as a result of the bodily injury that other parties sustained as a result of an accident you caused.

Since all of these damages can really add up, you can start to see why property damage liability coverage is a smart option for Illinois drivers. Call us today for more information on our affordable car insurance.

Differences Between Property Damage Liability and General Liability Insurance

Also called business liability insurance, general liability insurance protects businesses and professionals from being financially responsible for any property damage or bodily injury they or their products cause. Its similarity to property damage liability insurance is that they both cover financial expenses for property damage. Some essential differences include:

  • Who uses them: Property damage liability insurance is required by all drivers in the state of Illinois as part of their auto insurance policy. General liability insurance is used by businesses and other parties, such as contractors and service providers, that interact with customers, suppliers, or the general public.
  • Their scope: Property damage liability insurance only covers property damage that results from an auto accident. General liability insurance also covers property damage, but its scope includes other types of liability risks, such as bodily injury claims.
  • Legal requirement: All Illinois drivers are required to have property damage liability insurance. Although general liability insurance is strongly recommended for any business or professional, it's not legally required in Illinois; depending on your specific activity and the city or county you operate in, some form of business liability insurance may still be required.

What Does Property Damage Liability Insurance Cover?

Property damage liability insurance covers all property that you damage in an at-fault accident. It doesn't cover the repair costs for your own vehicle or any medical expenses. Some specific types of property covered by the property damage liability insurance include:

  • Vehicle damage: Most accidents include two or more vehicles. If you're the at-fault driver, property damage liability insurance will cover repair costs for other involved vehicles but not your own. 
  • Structural damage: You may accidentally hit various structures, such as buildings, fences, poles, mailboxes, and others. This type of insurance will cover the repair or replacement costs for these.
  • Public property damage: Some accidents damage public property, such as traffic signs, traffic lights, guardrails, or benches. Being insured prevents you from being financially liable for these damages.
  • Legal fees: At-fault accidents may result in lawsuits against you initiated by the damaged parties. Property damage liability insurance covers your legal costs.

Choosing the Right Insurance Company in Illinois

If you're looking for affordable car insurance in Illinois, contact us at American Auto Insurance. We've been working with Illinois customers for over 35 years, and our main goal has always been to have a customer-first approach in everything we do.


Our staff is always here to help you with everything you need, and we'll always do our best to understand your specific needs when it comes to auto insurance and any other type of coverage.

This is a comprehensive guide to Property Damage Liability Coverage. Feel free to jump around from section to section. Simply click on one of the questions below to find an answer.

How Does Property Damage Liability Coverage Work in Illinois?

Liability insurance options are typically offered in two varieties:


  • Combined single limit policies provide a certain amount of coverage, and the policyholder can decide how to divide that coverage between property damage and bodily injury. A combined single limit policy states a single dollar amount of coverage, which you can then apply to any combination of claims.
  • With a split limit policy, your insurance company decides how much coverage to include for property damage and bodily injury. For instance, you might see your policy written in shorthand as: 25/50/20. In this example, the first two figures apply to bodily injury coverage or death of one or multiple people involved in an accident, and Illinois sets those minimums at $25,000 and $50,000, respectively. The final figure, $20,000, goes toward repairing someone else’s property damage you caused in an accident.

In a scenario where you caused minor damage, such as swerving to avoid an animal and hitting a neighbor’s mailbox, your policy should completely cover the damages. When another vehicle is involved, however, major damage typically occurs. Let’s say you hydroplane and hit two vehicles, causing $25,000 in damage. Given the above example, your policy would pay up to $20,000 toward damages, but you’re responsible for the remaining $5,000 out of pocket.

When another motorist is injured in an accident and requires hospitalization, the bodily injury liability part of your coverage takes over. After exhausting the bodily injury limit, however, you’re left with the remainder of the hospital bills.

How Much Property Damage Liability Coverage Is Required in Illinois?

Having more property damage liability coverage is better than not having enough. The more coverage you have, the more likely your policy will completely cover damages. Even so, more coverage means paying a higher insurance premium, which isn’t always affordable.

Most states that require motorists to carry bodily injury and property damage liability insurance set minimum amounts. In Illinois, the minimum coverage limit per accident is $15,000. Keep in mind, however, that liability coverage is only one aspect of any required auto insurance policy. You’ll still need to meet the state’s minimum coverage requirements across the board. Fortunately, your insurance company will provide you with options that meet or exceed the legal requirements.

If you have trouble obtaining insurance through an insurance company, ask an agent about the Illinois Automobile Insurance Plan. This state-monitored program is for drivers who otherwise have difficulty getting coverage.

How Much Coverage Should You Buy in Illinois?

Now that you know the minimum coverage amounts required by Illinois law, you’re probably wondering how much you should actually purchase. While states have their own minimum requirements, those figures are relatively low when you consider how much property damage you can cause in an accident.

As of May 2019, the average price of a new car came in at $36,718, which was up over $1,000 just from the year before. If you only have $20,000 in property damage liability coverage, and you cause an accident that totals a new car valued at $30,000, you’ll have to come up with the remaining $10,000. If you can’t afford to pay that bill out of pocket, the affected party can sue you for the difference, putting your assets and savings at risk. You may even run the risk of losing your home or business.

With new car and property costs skyrocketing, your safest bet is to purchase the maximum amount of property damage coverage you can afford. At least $100,000 per person, $300,000 per accident, and $50,000 of property damage liability coverage is a solid choice.

How Much Does Property Damage Liability Coverage Cost in Illinois?

The costs associated with property damage liability coverage depend on numerous factors, including your driving history and the state you live in. Which insurance company you buy your liability coverage from will also affect the cost.

Using an online auto insurance calculator or comparing free quotes can help give you a better idea of how much you’ll need to set aside for your insurance policy. Let’s just say that you have a clean driving history and a decent liability-only policy ends up costing about $550 per year. Combined with a comprehensive and collision policy, your annual cost rises to about $1,060. If you only want to meet the state minimum requirement, you might be looking at around $425 liability only, or $940 comprehensive.

With a recent speeding ticket or accident, however, these costs will go up. Insurance costs are also affected by your age and your car’s make and model.

Overall, regardless of how much a comprehensive auto insurance policy costs, you should have enough coverage to protect you, your family, and your assets in the event that you cause a costly accident.

Ensure you’re covered in any scenario with adequate property damage liability coverage protection. Contact your local Illinois agent at American Auto Insurance to get started.

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