Definition
Liability Insurance refers to the portion of an auto policy that pays for bodily injuries and property damage the insured driver causes to other people in an accident. It is the only coverage Texas law requires, under Texas Transportation Code §601.072, and it is written at minimum limits of 30/60/25. Liability coverage does not pay for the insured's own vehicle, medical bills, or injuries — those losses require collision, comprehensive, PIP, or MedPay coverage. Liability insurance also typically pays for the insured's legal defense if the other party sues after an accident. Most DFW drivers are advised to carry liability limits well above the Texas minimum — commonly 100/300/100 — because a serious accident involving hospital bills and a totaled vehicle can easily exceed 30/60/25. Anything above the policy limit becomes the insured driver's personal financial responsibility.
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