What Do the Three Numbers Mean on an Auto Insurance Policy
The three numbers show the most your liability coverage pays per person hurt, per accident overall, and for property damage, in that order.
Each number is a separate limit
The first number is the most your insurer pays for injuries to any one person in an accident you cause. The second is the most it pays in total for injuries to everyone hurt in that same accident, no matter how many people. The third is the most it pays for damage you cause to someone else's car, fence, or other property.
These are liability limits. They cover harm you cause to other people, not damage to your own car. Your policy may list other coverages separately, like collision or comprehensive, but the three numbers together are what people mean by your liability split.
Your state sets the minimum, not the format
Every state requires some minimum version of these three numbers, but the minimums are different from state to state. A policy that meets the minimum in one state could fall short of what's required if you moved to another.
The numbers on your declarations page are whatever you and your insurer agreed to, which can be higher than the state minimum. If you're not sure what your state requires, your policy documents or your insurer can tell you, and the number will be listed as a minimum regardless of what you actually carry.
If a renewal notice shows different numbers than you remembered, check whether your state's minimum changed or whether your insurer adjusted your coverage. Either can happen without much notice.
What people get wrong about the second number
The second number is not added on top of the first. It's a ceiling for the whole accident, and the first number's limit still applies to any one person within it.
Say the first number is lower than the second. If one person is badly hurt, your insurer pays up to the first number for that person, even if the second number has room left. The rest of the second number is there in case other people were also hurt in the same accident.
This matters most when more than one person is hurt in an accident you caused. If the costs for any one person go past the first number, that person's own underinsured motorist coverage or a lawsuit may come into play, not your insurer paying past the limit.
Questions people ask about this
What does the property damage number cover?
It covers damage you cause to someone else's property, most often their vehicle, but also things like a fence or mailbox you hit. It does not cover your own car. If the damage you cause costs more than this limit, you may be responsible for the rest yourself.
Is a higher number always better?
A higher limit means more protection if you cause a serious accident, since you're responsible for costs beyond your limit either way. Whether paying for a higher limit makes sense depends on what you can afford to risk and what your insurer charges for the increase, so it helps to ask for a quote at a couple of different limits and compare.
Do these numbers change when I add another driver to my policy?
The liability limits themselves usually stay the same unless you ask to change them, but adding a driver can change what you pay for those same limits. Ask your insurer directly if you want to know how a new driver affects your premium rather than your coverage amounts.
Why does my policy show a fourth or fifth number?
Many policies list uninsured or underinsured motorist limits alongside the three liability numbers, and those work differently since they protect you if someone without enough insurance hits you. Check your declarations page for labels next to each number, since the order and count can vary by insurer.
Can I carry different limits for injury and property damage?
Yes, the injury limits and the property damage limit are set separately, and insurers often let you adjust them independently. What combinations are available depends on your insurer, so ask what options they offer if you want to raise one without raising the other.
See what these limits would cost at a level that fits what you want to carry.
Pull out your current declarations page and find the three numbers as they're written there, usually separated by slashes. Call your insurer or check your state's department of insurance website to see how your state's minimum compares to what you carry now. If you're thinking about raising any of the three numbers, ask for a quote at a couple of different limits so you can see the actual difference in cost. Do this before your next renewal, since that's when changes are easiest to make without a gap in coverage.
