What Does Liability Insurance Cover in California

Liability insurance is one of the most important protections California drivers can carry. It provides financial coverage for injuries or property damage you cause to others in an accident. Without it, you could be held personally responsible for thousands, if not hundreds of thousands of dollars in damages. Understanding exactly what liability insurance covers in California helps drivers make sure they are adequately protected on the road, especially given the state’s recent changes to minimum liability insurance standards and requirements in 2025.

At the Levinson Law Group, we help injured car accident victims throughout San Diego, Carlsbad, and across Southern California navigate complex insurance issues after a crash. Whether you are dealing with an at-fault driver’s insurer or your own, understanding liability coverage is a crucial step toward protecting your rights and financial future. If an insurance carrier refuses to pay what your policy promises, speaking with an experienced insurance lawyer can help you understand your legal options.

California’s Updated 2025 Minimum Liability Insurance Requirements

As of January 1, 2025, California increased its minimum required liability insurance limits for the first time in over 50 years. Drivers can review the full details of the state’s updated standards by visiting our page on california minimum auto coverage. The new insurance minimums are designed to reflect the current, higher medical and vehicle repair costs driven by inflation. Drivers must now carry at least:

• $30,000 for injury or death to one person
• $60,000 for injury or death to more than one person
• $15,000 for property damage

What Does Liability Insurance Cover in California?

Liability insurance in California provides two key types of protection: bodily injury liability and property damage liability. These cover the other driver’s losses, not your own.

Bodily Injury Liability

This covers medical expenses, rehabilitation costs, lost wages, and even pain and suffering for anyone who is injured in an accident for which you are held liable. If you are found legally responsible for causing the crash, your insurance will pay up to your policy limits for the other person’s injuries. It may also cover legal defense costs if you are sued after a collision.

Property Damage Liability

This portion of your liability insurance pays for repairs or replacement of property you damage in an at-fault accident. This includes another driver’s vehicle, fences, mailboxes, or even structures such as buildings or homes. It can also cover the cost of rental vehicles for the other party while their car is being repaired.

What Is Covered Under Liability Insurance in California?

While liability insurance for vehicles covers explicitly injuries and damages from auto accidents, general liability insurance is a broader form of protection often carried by business owners or contractors. It protects against claims for bodily injury, property damage, and personal injury, such as defamation or advertising harm, arising from business operations. For individuals, understanding general liability coverage is helpful when distinguishing between different types of insurance policies and their purposes.

What Does General Liability Cover in California?

While liability insurance for vehicles covers explicitly injuries and damages from auto accidents, general liability insurance is a broader form of protection often carried by business owners or contractors. It protects against claims for bodily injury, property damage, and personal injury, such as defamation or advertising harm, arising from business operations. For individuals, understanding general liability coverage is helpful when distinguishing between different types of insurance policies and their purposes.

Additional Types of Auto Insurance Coverage in California

Beyond basic liability insurance in California, there are several optional, but highly recommended, types of coverages available. For a deeper look at what protections can help prevent serious financial hardship after a crash, we’ve outlined what additional auto insurance coverage California drivers should consider.

Uninsured Motorist (UM) / Underinsured Motorist (UIM)

Uninsured motorist coverage in California helps protect you if you’re hit by a negligent driver who has no insurance. Underinsured motorist coverage applies when the at-fault driver in a car accident has insurance, but their policy limits aren’t quite enough to cover your losses. These similar, yet different, types of coverages are imporant in California car accidents, where a significant number of drivers remain uninsured or carry only the state required minimums.

Uninsured Motorist Property Damage

This type of coverage provides financial compensation for repairs to your vehicle if it’s damaged by an uninsured driver, up to a specified limit, typically $3,500. It applies only if the uninsured driver is identified and found to be at fault for the accident.

Med Pay Coverage

Med Pay covers medical expenses for you and your passengers, regardless of who caused the accident, but only up to what is defined in your specific policy. This type of insurance coverage can help pay for post accident ambulance fees, hospital bills, and even funeral costs in cases of wrongful death. Med Pay is especially useful when accident victims need to cover out-of-pocket medical expenses that may not be covered by your health insurance.

Collision Coverage

Collision insurance is another type of car insurance addition that pays for damage to your own vehicle that was sustained in a collision with another car or object, such as a guardrail, deer, or tree. Unlike liability coverage, collision coverage applies to your own car and is typically required by lenders at dealerships if you have a financed or leased vehicle.

Comprehensive Coverage

Comprehensive coverage protects your vehicle against non-collision accidents, such as:

• Theft
• Vandalism
• Fire
• Falling objects
• Natural disasters

Comprehensive coverage also covers damage to a covered vehicle if caused by hitting an animal on the road. This coverage is very important in areas like San Diego and Carlsbad, where weather and environmental hazards can sometimes cause unexpected damage.

Personal Injury Protection (PIP)

While not mandatory in California, personal injury protection (PIP) goes beyond Med Pay by helping to cover lost wages, childcare expenses, and other non-medical costs after an accident occurs in California. It can be particularly beneficial for accident victims that need time off of work, or child care while they recover.

Rental Reimbursement

Rental reimbursement is a type of additional insurance coverage that helps pay for a rental car while your vehicle is being repaired after an accident covered by your policy. This can be a major convenience if you rely on your vehicle for daily transportation or commuting.

Gap Coverage

Gap insurance is a very important optional form of car insurance, that applies to anyone with a car loan or lease. If your vehicle is totaled and the insurance payout is less than the balance on your loan, then gap coverage pays the difference. Without it, you could be left owing money on a car that you can no longer drive or even have if the insurance company deems it totaled.

Umbrella Coverage

Umbrella insurance provides extra liability protection beyond the limits of your auto or homeowners policies. It can cover legal fees, large settlements, or judgments that exceed your primary insurance limits. For high-net-worth individuals or families, umbrella coverage offers valuable peace of mind.

Why Liability Insurance Is Important To Have in California

Driving without sufficient liability insurance in California can have serious legal and financial consequences for drivers. If you are involved in an accident and are found to be at fault, you could face various penalties, including:

• License suspension
• Fines
• Personal lawsuits

Moreover, accident victims may pursue compensation directly from your personal assets if your policy limits are too low. In cases where insurers delay, deny, or underpay valid claims, working with experienced bad faith lawyers may be necessary to enforce your rights.

Liability coverage is not just about complying with the California traffic laws, it’s about protecting your financial security and the well-being of others on the road. Even though California’s 2025 minimum requirements have increased, those limits can be exhausted quickly in severe collisions. Many drivers wisely choose policies with higher limits, such as $100,000 / $300,000 / $100,000, to make sure you are fully protected.

How the Levinson Law Group Can Help You Understand Liability Insurance Coverage in California

Even with proper insurance coverage, recovering fair compensation from an insurance provider after a car accident is not always straightforward. Insurance companies often undervalue claims or attempt to deny coverage all together. If you need guidance on how to sue insurance company after a crash, the Levinson Law Group can evaluate your case and explain your legal options.

At the Levinson Law Group, our experienced personal injury attorneys in San Diego and Carlsbad handle all aspects of accident claims, including looking at the specific coverage you have, negotiating with insurers, and pursuing lawsuits when necessary.

At Levinson Law Group, our team has decades of experience helping clients understand their policies, identify all sources of coverage, and maximize their compensation after serious car accidents in California. Whether your case involves disputed liability for the accident, uninsured drivers, or complex policy language, our firm is always ready to protect your rights.

Serving clients across San Diego, Carlsbad, and Southern California, our team is here to help you understand your coverage and protect your rights. Call (619) 436-5000 now for a free consultation.