Should I Get Liability Only Car Insurance
Liability only is right once your car is worth so little that insuring it for damage costs more than the car is worth replacing.
Check these before you drop full coverage
- Your car's actual value Look up what your car would sell for today, not what you paid. If that number is low, you're paying to insure damage that wouldn't cost much to replace anyway.
- Whether you still owe money Lenders almost always require full coverage until the loan is paid off. If you're still financing or leasing, liability only usually isn't an option yet.
- Your savings cushion Liability only means you pay out of pocket if your own car is damaged or stolen. Make sure you actually have that cash set aside before you count on it.
- How you'd replace the car If losing this car tomorrow would be a real problem, that's a sign you still need the payout collision and comprehensive provide. If you have a backup plan, that risk matters less.
- What your state requires Liability limits and what counts as minimum coverage vary by state. Check your state's requirements before you assume liability only is even enough on its own.
The short version
Go liability only once your car's value is low enough that repair or replacement payouts wouldn't amount to much, and you're not financing it. The real question is whether you could cover a total loss yourself. If you could, dropping collision and comprehensive saves money with little downside. If you couldn't, keep full coverage a while longer.
What happens if I switch and then total my car?
With liability only, your insurer pays nothing toward your own car if you cause the accident or if it's damaged in a way collision and comprehensive would normally cover. Liability coverage pays for the other driver's car and injuries, not yours. If you total your car, you're on your own for replacing it.
This is the real tradeoff behind the whole decision. It's not about whether you're a careful driver, it's about whether you could absorb that cost without the insurance payout. If you have enough saved to replace the car outright, liability only just means you're self-insuring that risk instead of paying someone else to carry it. If you don't have that cushion, a totaled car becomes a much bigger financial problem than the premium you were trying to save.
Some drivers land in between, keeping liability only but setting aside a dedicated fund for exactly this scenario. That works as long as you actually keep the fund untouched and update it as car values change.
Compare liability only quotes now that you know whether your car's value and savings support dropping full coverage.
Deciding whether to drop full coverage now
If you do
Your premium drops right away since you stop paying for collision and comprehensive. If your car is damaged, stolen, or totaled, you pay for repairs or replacement yourself. This works fine if your car's value is low and you have savings to cover a worst case.
If you don't
You keep paying for collision and comprehensive, which still make sense if your car has real value or you're still financing it. Your car damage is covered no matter who's at fault. You carry a higher premium but less financial risk if something happens to your own car.
A driver with a ten year old paid off car
A driver had been paying full coverage on a car that was now ten years old and fully paid off. They looked up what the car was actually worth and found it had dropped enough that a payout for a total loss would barely cover a cheap used replacement. They also had enough savings to cover that kind of cost if the car was totaled or stolen, so the safety net full coverage provided wasn't doing much for them anymore.
They switched to liability only and kept their state's required coverage in place, checking first to make sure their limits still met the minimum. The premium dropped meaningfully, and they set aside a small amount monthly into a separate fund earmarked for car repairs or replacement, treating it like the insurance payment they no longer had to make. A year later a minor accident left the car with cosmetic damage not worth fixing. They were out some money, but far less than the year of premium difference they'd already saved, and they had the cash ready without needing to file a claim at all.
