Everything You Need to Know About Product Damage Liability Cover

Product Damage Liability is an auto insurance coverage that pays for damages caused to another person’s property due to an accident for which you are at fault. PDL is a standard component of auto insurance but can also be included in other types of insurance coverage.

PDL covers the costs of repairing damages caused to another person’s car when you cause an accident. This cover also extends to non-vehicle properties such as buildings, mailboxes, fences, utility poles, and any other property you damage in an accident. This article focuses on helping readers understand product damage liability coverage. 

How PDL Works

PDL has a policy limit, which is the maximum amount your insurer will pay for any property damage claims. When damages caused exceed the maximum limit, you will have to pay the balance out of your pocket.

PDL is mandatory in any auto insurance, and most states in the U.S. have a bare minimum amount that you need to pay as part of your car insurance. This minimum value varies from state to state. 

For example, the minimum PDL mandatory coverage in the state of Florida is $10,000, in California $5,000, and in Texas it is $25,000. To claim PDL, the affected party lodges a claim against your insurance. If successful, the insurer pays up to the policy limit. 

Why PDL is Important 

PDL is important because it is a legal requirement in auto insurance. Driving without a PDL cover means you’re not compliant with traffic laws, and you risk fines, license suspension, and other penalties depending on your state laws.

Consequently, PDL protects you from unplanned financial liabilities in case of accidents. You will not need to pay the full costs of property repairs in accidents that you cause, but only the amount that exceeds your policy limit.

Exclusions

PDL does not cover damages to your property or car, intentional property damages, or any damages caused while using the vehicle for business purposes unless specified in the policy.

Your insurer will need to prove that the damages were purely caused by an accident before paying the claimant party. This process requires investigating the accident, and it might take a while. However, an attorney can help follow up on the claim to ensure the insurer pays what they are supposed to. 

Recommendations

It is recommended that you take a PDL cover that exceeds the state limit so that you protect yourself from significant financial liabilities in severe accidents. For example, a PDL cover of around $5,000 will most likely cover any extensive damages, as repair costs are quite expensive. 

However, some policies include optional protections, like umbrella insurance, for added liability coverage beyond standard limits. Also, review your policy on a regular basis and adjust it if possible so that it matches your needs and complies with your state’s laws. 

Example Scenario

Say you’ve accidentally hit the utility pole of your neighbor’s house because you were avoiding a child running across the road. Your neighbor will file a claim against your insurance for repairing the damages caused, and since this was clearly an accident, the insurer will pay for the damages.

If the repairs fall under your PDL policy limit, you will not pay a dime; however, if it exceeds, the excess money will come out of your pocket.

Conclusion

PDL cover is very important for car owners because you never plan to be in an accident, but accidents can happen in unexpected scenarios. Consider a PDL cover that exceeds the minimum amount in your state so that you don’t get into serious financial trouble. Seek legal counsel from property damage lawyers before purchasing a PDL cover just to be safe.