What are the different types of car liability insurance?

Car insurance can provide a wide variety of differing levels of cover, but the most essential for everyone is what it provides by way of liability insurance. So essential is this for most people, that there is likely to some legal requirement where the person lives that they have at least some liability insurance in place for any vehicle driven on a public road or highway.

Where there can be some confusion, and often difficulty, is the level of cover needed, and who or what it actually covers in the event of a claim or an accident. It can sometimes seem a slightly difficult maze to navigate, but is crucially important as it can have literally life changing effects for everyone involved if the insured gets it wrong.

The first thing to do is to understand the different types of liability insurance that exist. This can be slightly complicated in itself because different insurance companies and different countries will sometimes use different terminology. What is important is that the terminology is read and understood as to what it means, both to comply with any legal requirements and to make sure there is adequate insurance coverage available.

Third-party liability is a phrase often used in car insurance, and it will cover all types of liability insurance. In car insurance, it is important to understand that third-party liability may or may not include passengers in the car, depending upon any exclusions or restrictions placed on the policy. Third-party liability is intended to cover people and property that the insured vehicle may come into contact with and cause damage to or loss of life to. The policy should include passengers in the insured's car as well, but this is something that should be checked to make sure.

Third-party liability is a general catchall phrase, and unless specifically defined otherwise should include both property and person. Often the insurance company will make a distinction between people and property, and provide different levels of cover for each sectio.  Quite often, there is a legal requirement for specific amounts for both these areas of insurance, and the insured should make sure that the legal requirements are complied with.

Over and above that, people often wonder what is the most cover that they can or should obtain in terms of liability insurance. The short answer is that they should obtain as much they can afford. This is an area where cutting costs or cutting corners is really not advisable, as the long-term effect can be devastating for everyone involved.

Insurance policies will normally specify tpl as third-party liability or policies relating to physical damage or bodily injury. The third-party liability amount should cover both these areas but it is important to check this is the case. It is also important to mention that in the event of any accident or claim, that the insured does not admit liability by way of saying that they admit fault or they were in the wrong in any particular area.

This might seem slightly obvious, but when an accident happens people often feel quite guilty about their driving, even if they were not the cause of the accident or they had not done anything wrong. People often want to make a bad situation better and will sometimes say things in order to try and do this.

This can be quite dangerous, as admitting liability in the event of an accident can be in breach of a condition of the insurance policy. Whilst this would be quite a harsh interpretation by the insurance company, it does leave the policyholder open to the potential denial of the claim, and to the insurance company denying any liability and voiding their responsibilities to pay any future settlement.