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by Indiana Farm Bureau Insurance

Liability insurance guide – 2022

Happy man smiling from inside the driver's seat in his vehicle

Drivers who operate motor vehicles in the state of Indiana should know about liability insurance. Liability auto insurance is required by law, but there is more to understanding this type of insurance. Auto insurance liability coverage is an insurance product that offers many features depending on the policy. Researching this form of coverage can help you find the right policy that fits your needs.   This insurance guide covers the essential information a person should understand about liability insurance. 


What is liability auto insurance and what does it cover? 


Liability coverage can help pay for injury or lost wages that an at-fault driver (the person found to have caused the accident) causes to other drivers and their passengers. The policy also provides coverage for damage caused to the other drivers’ cars if you are at fault for an accident.  

Indiana Farm Bureau Insurance offers our customers many options to consider when purchasing insurance protection. There are two primary types of auto liability insurance: bodily injury and property damage. 


Bodily injury protects an at-fault insured driver from claims for the medical bills and possible lost wages expenses incurred by other people harmed in the auto accident, up to the limits of the policy. This coverage can also cover claims for pain and suffering (including emotional) and funeral costs. Here are some features a person should know about bodily injury coverage. 

  • Only the other person’s expenses are covered (not yours) 

  • It does provide coverage for legal fees you may incur if the injured party files a lawsuit against you, as the at-fault driver in the accident 

  • There are limits on how much will be paid per person injured and per accident  

  • Premiums may vary depending on the driver and the amount of coverage that is purchased 


Property damage can cover liability, up to the limits of the policy, that was a result of an at-fault driver causing damage to someone else’s property. Such damage can include: 


  • Damage to the other vehicles; this can include body shop labor and replacement parts 

  • Damage to other buildings, fences, houses, lampposts, etc. 

  • Legal fees that may result from a property damage claim 

  • Loss of income from any business closure caused by the accident 

  • Recurring expenses that may arise from the accident 

Car insurance requirements in Indiana  


The Hoosier state is clear about auto insurance liability coverage: you must have it! Additionally, a driver must show proof of insurance if requested by a law enforcement officer to do so. 


The formula for minimum mandated coverage is 25/50/25. In Indiana, this means: 


  • $25,000 for bodily injury or death of a person in an accident caused by the at-fault driver 

  • $50,000 for total bodily injury or death in an accident caused by the at-fault driver  

  • $25,000 for property damage caused in an accident by an at-fault driver  


There can be consequences for failing to drive without proof of insurance in Indiana including: 


  • A license suspension up to one year  

  • Costly reinstatement fees  

  • Possible filing of an SR-22, a certification of financial responsibility which is needed to restore the suspended license 

The penalty can vary depending on the number of prior accidents a driver has caused. 

Keep in mind that there are various levels of coverage for liability insurance. The overall cost of an automobile accident can be tens of thousands of dollars, which can be more than the state minimum amount of coverage requires. 


In some situations, the other party involved may sue for damages. There can be consequences if the at-fault driver does not have sufficient insurance to cover damages. In some cases, it may be prudent to have enough insurance to cover any contingency. This may mean you purchase more coverage than the Indiana required minimum.  


How much does liability insurance cost? 


The good news is thatauto insurance in Indiana is relatively inexpensive compared to other states. The average premium for Indiana drivers varies based on coverage, certain risk and contributing factors, can be $30 to $105 a month depending on various factors. The challenge is the contributing factors that determine the premium can fluctuate. Those determinants of the premium amount may include: 


  • Age 

  • Driving history 

  • Location 

  • Marital status 

  • And more 

High-risk drivers can anticipate paying above higher premiums if there is an at-fault accident in their history. The premiums are not arbitrary decisions. Actuaries labor long and hard to determine risk factors and rate structures, which are filed with the state’s department of insurance. So, how much auto liability insurance coverage do you need?  

Find out how much you need  

When deciding how much coverage you need you will want to take into consideration various factors including the ones above along with other details, such as your risk comfort level.   

At Indiana Farm Bureau Insurance, we focus on developing a relationship with our clients and finding out exactly what they are looking for in their insurance policies. Because we have offices in all 92 counties, it is not difficult at all to find a local Indiana Farm Bureau Insurance agent. Do you prefer to buy online? We can help you. Get a free online quote and purchase an auto insurance policy online.