Property damage liability insurance is a type of car insurance coverage that pays for damage you cause to another person’s property, such as their car or home, as a result of an accident. Property damage liability coverage is one of two types of liability car insurance and is required in most states.
What Property Damage Liability Insurance Covers
- Damage to other cars caused by the policyholder’s vehicle.
- Damage to structures, such as houses, offices, or stores, caused by the policyholder’s vehicle.
- Damage to stationary objects, such as trees, mailboxes, fences, and lampposts, caused by the policyholder’s vehicle.
Property damage liability insurance will only cover damage up to a driver’s policy limit, and that limit applies per accident. If the total amount of property damage the policyholder causes exceeds that amount, they may be responsible for paying the remaining costs out of pocket.
Property damage liability insurance never covers damage to the policyholder’s own vehicle or property. In order to cover their own vehicle repairs, the policyholder would instead need to use collision or comprehensive coverage.
Learn more about what property damage liability insurance covers.
How Property Damage Liability Works
Property damage liability coverage serves as one part of auto liability insurance along with bodily injury liability coverage. If you’re at fault for an accident, the other driver files a claim with your liability insurance policy. Your property damage liability insurance pays for their property damage expenses, such as damage to their vehicle. Their medical bills are covered by your bodily injury liability insurance. Liability insurance can also cover your legal fees if you are sued because of an incident.
While liability insurance is designed to pay for the victim’s accident-related expenses, your insurance company does not write a blank check to cover whatever the victim needs. How much the insurance company will pay is determined by policy limits.
Liability insurance policies are described as either a combined single-limit policy or a split-limit policy. Combined single-limit policies don’t differentiate the coverage limits between property damage and bodily injury liability, while split-limit policies specify how much coverage is available per liability insurance type.
Learn more about how property damage liability works.
Property Damage Liability vs. Collision Insurance
While collision insurance covers damage to your own car, property damage liability insurance will only cover damage to other people’s property that you cause in an accident. Your property damage liability insurance never covers your own car’s damage.
Property damage liability insurance is also required by law in almost every state, while collision coverage is only required by lenders. In other words, you won’t get in legal trouble if you don’t have collision insurance, but you could be in hot water with the company that gave you your car loan or lease. Both property damage liability insurance and comprehensive insurance are part of full coverage, however.
Learn more about property damage liability insurance and collision insurance.
How Much Property Damage Liability Insurance Do I Need?
You need to purchase at least the minimum amount of property damage liability insurance required by your state. State minimums typically range from $5,000 to $25,000 in coverage, but the minimum amount of coverage is typically not enough to cover all accident-related expenses. If property damage costs exceed your coverage limits, you are personally liable for the remaining balance. In that case, the other party may sue you, putting your savings and assets at risk.
Minimum Property Damage Liability Insurance Required by State
| State | Property Damage Liability Limit |
|---|---|
| Alabama | $25,000 |
| Alaska | $25,000 |
| Arizona | $15,000 |
| Arkansas | $25,000 |
| California | $ 15,000 |
| Colorado | $15,000 |
| Connecticut | $25,000 |
| Delaware | $10,000 |
| District of Columbia | $10,000 |
| Florida | $10,000 |
| Georgia | $25,000 |
| Hawaii | $10,000 |
| Idaho | $15,000 |
| Illinois | $20,000 |
| Indiana | $25,000 |
| Iowa | $15,000 |
| Kansas | $25,000 |
| Kentucky | $25,000 |
| Louisiana | $25,000 |
| Maine | $25,000 |
| Maryland | $15,000 |
| Massachusetts | $ 30,000 |
| Michigan | $10,000 |
| Minnesota | $10,000 |
| Mississippi | $25,000 |
| Missouri | $25,000 |
| Montana | $20,000 |
| Nebraska | $25,000 |
| Nevada | $20,000 |
| New Hampshire | $25,000 |
| New Jersey | $5,000 |
| New Mexico | $10,000 |
| New York | $10,000 |
| North Carolina | $ 50,000 |
| North Dakota | $25,000 |
| Ohio | $25,000 |
| Oklahoma | $25,000 |
| Oregon | $20,000 |
| Pennsylvania | $5,000 |
| Rhode Island | $25,000 |
| South Carolina | $25,000 |
| South Dakota | $25,000 |
| Tennessee | $25,000 |
| Texas | $25,000 |
| Utah | $ 25,000 |
| Vermont | $10,000 |
| Virginia | $25,000 |
| Washington | $10,000 |
| West Virginia | $25,000 |
| Wisconsin | $10,000 |
| Wyoming | $20,000 |
Minimum coverage requirements are per accident and were last updated in December 2025
Note that some states give you the option to forgo car insurance if you have enough assets to “self-insure.” In these states, you may have to deposit significant funds that could be used if you caused an accident or post a bond. If you—like the vast majority of drivers—opt not to “self-insure,” then you are required to meet at least the minimums above.
We recommend that you buy the maximum amount of property damage coverage that you can afford to prevent someone from going after your savings and assets. The end goal should be for your combined liability car insurance limits to at least equal your net worth, which will protect your assets if you’re sued. If your net worth is particularly high, you can supplement your property damage liability limits with a personal umbrella policy.
Learn more about how much property damage liability insurance you should have.
How Much Does Property Damage Liability Insurance Cost?
In general, the cost of property damage liability insurance depends on how much you purchase. The higher your limits are, the more expensive your coverage is going to be.
The table below provides an example of the average additional cost drivers in Los Angeles may incur annually if they increase their property damage liability limits above a baseline of $10,000.
Added Annual Cost for Additional Coverage
| Property Damage Coverage Limits | From $10K to $25K | From $10K to $50K | From $10K to $100K |
|---|---|---|---|
| Driver with clean driving history | $88 | $114 | $141 |
| Driver with recent speeding ticket | $188 | $231 | $273 |
| Driver with recent accident | $146 | $182 | $210 |
Note: Costs were calculated using quotes from multiple insurance providers for a 37-year-old female with excellent credit in ZIP code 90001 driving a 2008 Honda Accord. The annual cost of the policy also includes $50,000/$100,000 in bodily injury liability insurance as well as collision and comprehensive insurance with $500 deductibles.
How to File a Property Damage Liability Claim
If another driver damages your property, their property damage liability insurance should cover the cost of repairs, up to their preset limit. Filing a property damage claim typically involves the following steps:
1. Document the Damage
Take photos or videos of the damage to your property. You should also make a list of any damaged items and their estimated value.
2. Get Information From the Other Driver(s)
After the accident, you should get the contact information and the insurance information of all the other drivers involved, including their full names, phone numbers, insurance providers and policy numbers.
3. Report the Accident to Your Insurance Company
Even if you are not at fault, insurance companies typically require you to report accidents to them promptly. This can help your insurance company defend you if the at-fault driver files a claim against you. It may also ease the claims process if you have to file a claim with your insurer if the at-fault driver is uninsured.
4. File the Claim with the At-Fault Driver’s Insurance Company
You can file a claim with the at-fault driver’s insurance company by calling them and providing the at-fault driver’s policy number and a description of what happened. The insurance company will assign you a claim number and an adjuster to verify your case.
5. Cooperate With the Adjuster
The at-fault driver’s insurance company will typically assign an adjuster to investigate your claim and assess the damage. Be sure to provide the adjuster with any documentation or information they need. You may need to meet with the adjuster in person to show them the damage.
6. Receive an Estimate
After the adjuster has assessed the damage, they will provide you with an estimate for the cost of repairs or a settlement offer to replace your vehicle. You may want to get your own estimate from an independent repair shop to make sure the at-fault driver’s insurance company is giving you a fair price.
7. Get Your Vehicle Repaired
Take your vehicle to a repair shop and provide the shop with the at-fault driver’s insurance information. The repair shop will then contact the insurance company for further information and payment. Remember, the insurance company can recommend repair shops to you, but they cannot force you to go to any particular one.
8. Finalize Your Insurance Payout
The insurance company will pay the repair shop directly if your car just needs repairs. If your car was totaled, the insurance company will either send you a check or provide you with a comparable replacement vehicle. You’ll be required to sign a release form accepting the payment and promising not to pursue any further claims related to the accident.
Learn more about property damage claims.
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