Auto Insurance: 100/300 vs 250/500 Liability Limits – Which is Better?

When shopping for car insurance, you’ll need to select liability coverage limits. This coverage protects you if you cause an accident that injures someone else or damages their property. Liability limits are shown as three numbers, such as 100/300/100 or 250/500/250. But what do these numbers mean and how much coverage do you actually need?

This guide will explain what the numbers in liability limits represent, compare 100/300/100 vs 250/500/250, and provide tips for choosing the right amount of coverage.

What Do the Numbers Mean in Liability Limits?

Liability limits contain three dollar amounts that indicate the insurer’s maximum payout per accident:

• The first number is the per person bodily injury limit – the max that will be paid per injured person
• The second number is the per accident bodily injury limit – the max for total injuries in one accident
• The third number is the property damage limit – the max that will be paid for damaged property

For example, 100/300/100 means:

• $100,000 bodily injury per person
• $300,000 total bodily injuries per accident
• $100,000 property damage per accident

Similarly, 250/500/250 means:

• $250,000 bodily injury per person
• $500,000 total bodily injuries per accident
• $250,000 property damage per accident

The higher the limits, the more insurance protection you have. But higher limits also come with a higher premium.

Comparing 100/300/100 vs 250/500/250

The most common liability limits recommended today are 100/300/100 and 250/500/250. Here’s how they compare:

100/300/100

• Meets state minimum requirements in most states
• Provides decent protection for minor accidents
• Lower premiums ($150-$300/year for full coverage)
• May not be enough coverage for serious accidents
• Higher out-of-pocket costs if you exceed the limits

250/500/250

• Exceeds requirements in most states
• Better protection for serious bodily injury accidents
• Enough coverage for many major accidents
• Higher premiums ($200-$400/year for full coverage)
• Lower chance of out-of-pocket costs up to $500,000 total/$250,000 per person

The 100/300/100 limits are usually sufficient for minor fender benders. But serious accidents often exceed $100,000 in damages, especially when injuries are involved.

250/500/250 can provide much more complete protection in case of a high-cost accident. But you’ll pay 20-50% more in premiums.

When to Consider 250/500/250 Limits

Here are some situations when it may make sense to get the higher 250/500/250 liability limits:

• You have significant assets to protect. Higher liability limits prevent more assets from being seized if you are sued.
• You drive regularly in congested urban areas where accidents are more frequent.
• You or a family member has a long commute. More miles driven means more accident exposure.
• You have teenage drivers in your household. Teens are riskier to insure.
• You own a luxury, performance, or specialty vehicle. Repairs and medical bills will be higher.
• You have caused an at-fault accident in the past 3 years. Higher risk drivers need more protection.
• You are uncomfortable with the $100,000 per person bodily injury cap. Serious injuries often exceed $100k.

For low-risk drivers with newer, mid-range value cars, 100/300/100 is usually sufficient. But for many families today, the extra protection of 250/500/250 is worthwhile.

Other Factors to Consider

Liability limits are just one piece of your overall auto insurance policy. Here are some other factors to keep in mind when making coverage decisions:

Umbrella Insurance

If you want liability protection above 250/500/250, consider adding an umbrella insurance policy. This provides additional liability coverage up to $1 million or more. Umbrella insurance is inexpensive compared to raising auto liability limits to the same level.

Collision and Comprehensive Coverage

The liability limits only cover damage you cause to others. To cover damage to your own vehicle, you need collision and comprehensive coverage. Set your deductibles wisely – higher deductibles can save substantially on premiums.

Uninsured/Underinsured Motorist Coverage

This protects you if you’re in an accident caused by a driver with no or too little insurance. Match your uninsured/underinsured motorist limits to your liability limits for full protection.

State Minimum Requirements

Most states require at least 25/50/25 liability limits. Make sure you meet or exceed your state’s minimum requirements.

Driving Record

Drivers with accidents and tickets on record will pay more for liability coverage. Improving your driving can lead to discounts and lower premiums over time.

The Best Auto Liability Limits for Most Drivers

For a balance of protection and premium savings, the sweet spot for liability limits is often:

• 100/300/100 – for safe drivers with clean records
• 250/500/100 – for families with some risk factors

100/300/100 meets requirements in most states, provides solid coverage for minor accidents, and keeps costs affordable for low-risk drivers.

But upgrading to 250/500/100 pushes the per accident bodily injury max higher while keeping the cost increase minimal compared to 250/500/250. This “middle ground” option gives families with teen drivers or busy commuters decent protection without overspending.

Always compare quotes for different liability limit options from multiple insurers. Also consider umbrella insurance for added protection above 250/500/250. With smart shopping and appropriate limits, you can gain peace of mind while optimizing value.