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Auto Liability Limits Explained

By Richard Sweet. Reviewed by Richard Sweet. Updated June 25, 2026.

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When you compare quotes, the liability limit is the first number to check and the most common place a cheaper quote hides a weaker policy.

What liability coverage does

Auto liability pays for injuries and damage you cause to other people, up to your limits, and it pays to defend you if you are sued. It does not pay for your own car or your own injuries. It is the coverage the law requires because it protects everyone else on the road.

Bodily injury vs property damage

Liability has two parts. Bodily injury liability covers the medical costs, lost wages, and legal claims of people you injure. Property damage liability covers the other vehicle and other property you damage. They carry separate limits, which is why you see three numbers.

What 100/300/100 means

Split limits are written as three numbers. 100/300/100 means 100,000 dollars per injured person, 300,000 dollars total per accident for all injuries, and 100,000 dollars for property damage. If a crash injures three people seriously, the per-person and per-accident limits both matter.

Why state minimums are rarely enough

In Oregon, the minimum is 25/50/20. One serious injury, a totaled late-model vehicle, or an ambulance and a hospital stay can blow past those numbers quickly. When the limit runs out, the injured party can pursue your assets and future wages. Minimums keep you legal; they do not keep you protected.

How limits connect to an umbrella

A personal umbrella adds liability above your auto and home limits, but it requires you to carry stated minimum underlying limits first, often 250/500 or higher on auto. If protecting assets matters to you, the auto liability limit and the umbrella are sized together, which we cover in why most families need a personal umbrella.

Red flags when comparing quotes

A much cheaper quote often drops the liability limit. Check whether the new quote matches your current limits or quietly steps them down toward state minimums. A lower limit is not savings. It is exposure you took on without noticing.

Continue the series

You are reading part 2 of How to Compare Auto Insurance Quotes Without Getting Burned.

Previous: What “Full Coverage” Auto Insurance Actually Means

Next: Split Limits vs Combined Single Limit

What many people don't realize

The part that catches owners off guard

  • Liability coverage pays for injuries and damage you cause to others, up to your limits.
  • Bodily injury and property damage are separate limits.
  • 100/300/100 means 100k per person, 300k per accident for injuries, and 100k for property damage.
  • State minimums satisfy the law but rarely match what a serious crash actually costs.
The Vantage Point

What we see most often

Liability is the coverage you buy for everyone else, and the one that protects you most. If you cause a serious crash, your liability limit is the wall between the claim and your savings, your wages, and your home equity. State minimums are built to make insurance affordable and legal, not to actually cover a bad accident. That gap is where drivers get hurt financially.

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When to review

It may be time for a coverage review if:

  • You carry state-minimum or low liability limits
  • You have assets, income, or home equity to protect
  • You own a business or have a higher public profile
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Frequently asked

Frequently asked

What do 100/300/100 auto limits mean?
100,000 dollars of bodily injury coverage per person, 300,000 dollars per accident for all injuries combined, and 100,000 dollars for property damage you cause. They are the per-person, per-accident, and property buckets of your liability.
What are Oregon's minimum auto liability requirements?
Oregon requires at least 25,000 dollars per person and 50,000 dollars per crash for bodily injury, 20,000 dollars for property damage, plus 15,000 dollars of PIP and uninsured motorist coverage of 25,000 per person and 50,000 per crash. Minimums meet the law, but a serious crash can cost far more.
How much liability coverage should I carry?
It depends on your assets, income, home equity, business exposure, and comfort with risk. Many households carry well above state minimums and coordinate the auto limit with an umbrella. There is no single right answer, which is why a review helps.
RS
Written and reviewed by

Richard Sweet

Founder and Principal Advisor, Vantage Point Risk

Richard Sweet runs Vantage Point Risk, an independent insurance and risk advisory for property owners, real estate investors, business owners, and families. He works with investors every week on the coverage decisions that decide how a claim actually turns out, and writes the Learning Center to put those decisions in plain language.

Reviewed for accuracy by Richard Sweet. Last updated June 25, 2026.

Richard also writes The Vantage Point, notes on building a better business.

Coverage varies by insurance company, policy form, state, endorsements, limits, deductibles, and exclusions. This is general educational information, not a guarantee of coverage or insurance advice. Actual coverage depends on the specific policy language.

Related resources

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Split Limits vs Combined Single Limit

Liability limits come in two shapes: split limits like 100/300/100 and a single combined limit. Here is how each works, how they behave in a real claim, and which may be more flexible when one accident causes several kinds of loss.

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What a Personal Umbrella Covers, and Why Most Families Need One

A personal umbrella adds liability limit over your home and auto for the claim that exceeds them. It is inexpensive, and it protects your assets and future income from a single bad event.

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Uninsured and Underinsured Motorist Coverage

Liability protects other people. Uninsured and underinsured motorist coverage protects you when the at-fault driver has no insurance or not enough. Here is how UM and UIM work, how they handle hit-and-runs, and why the limits matter.

Related

How to Compare Auto Insurance Quotes Without Getting Burned

A lower auto insurance quote is not always a better one. Use this method to compare a new quote against your current policy, coverage by coverage, so you understand what changed before you switch, not just what you saved.
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