{
  "slug": "auto-liability-limit-adequacy",
  "title": "Auto Liability Limit Adequacy Calculator",
  "heading": "Auto Liability Limit Adequacy Calculator",
  "category": "financial",
  "url": "https://www.revenuelab.fyi/toolbox/auto-liability-limit-adequacy",
  "summary": "Check whether your bodily injury and property damage limits actually protect your assets.",
  "description": "State minimum auto liability limits — often written as 25/50/25 or similar — are almost always too low to protect your assets in a serious at-fault accident. A single severe injury claim, like a traumatic brain injury or long-term disability, routinely exceeds $100,000 per person in medical costs and lost wages alone. This calculator compares your current limits against a realistic exposure estimate built from your net worth, income, and the number of people you regularly drive with, then tells you the gap between what you're carrying and what a bad-case lawsuit could actually cost you, factoring in that anything above your policy limit typically comes out of your personal assets.",
  "formula": "Exposure need = net worth + (1 year income) + (severe injury benchmark × passengers at risk); gap = need − current per-occurrence limit.",
  "dateModified": "2026-09-30",
  "run_url": "https://www.revenuelab.fyi/api/public/calc?tool=auto-liability-limit-adequacy",
  "inputs": [
    {
      "id": "currentPerPersonLimit",
      "label": "Current per-person BI limit",
      "kind": "number",
      "hint": null,
      "default": 100000,
      "unit": "$",
      "min": 0,
      "max": null
    },
    {
      "id": "currentPerOccurrenceLimit",
      "label": "Current per-occurrence BI limit",
      "kind": "number",
      "hint": null,
      "default": 300000,
      "unit": "$",
      "min": 0,
      "max": null
    },
    {
      "id": "netWorth",
      "label": "Net worth",
      "kind": "number",
      "hint": null,
      "default": 300000,
      "unit": "$",
      "min": 0,
      "max": null
    },
    {
      "id": "income",
      "label": "Annual income",
      "kind": "number",
      "hint": null,
      "default": 90000,
      "unit": "$",
      "min": 0,
      "max": null
    },
    {
      "id": "typicalPassengers",
      "label": "Typical passengers at risk per trip",
      "kind": "number",
      "hint": null,
      "default": 2,
      "unit": null,
      "min": 0,
      "max": 7
    }
  ],
  "outputs": [
    {
      "id": "recommendedLimit",
      "label": "Recommended per-occurrence limit",
      "format": "currency",
      "hint": null,
      "primary": true
    },
    {
      "id": "exposureNeed",
      "label": "Estimated worst-case exposure",
      "format": "currency",
      "hint": null,
      "primary": false
    },
    {
      "id": "occurrenceGap",
      "label": "Gap vs current per-occurrence limit",
      "format": "currency",
      "hint": null,
      "primary": false
    },
    {
      "id": "perPersonAdequate",
      "label": "Per-person limit adequate (1=yes, 0=no)",
      "format": "number",
      "hint": null,
      "primary": false
    }
  ],
  "worked_example": {
    "inputs": [
      "Current per-person BI limit: 100000 $",
      "Current per-occurrence BI limit: 300000 $",
      "Net worth: 300000 $",
      "Annual income: 90000 $",
      "Typical passengers at risk per trip: 2"
    ],
    "outputs": [
      "Recommended per-occurrence limit: $1,100,000",
      "Estimated worst-case exposure: $1,090,000",
      "Gap vs current per-occurrence limit: $790,000",
      "Per-person limit adequate (1=yes, 0=no): 0"
    ]
  },
  "how_to": {
    "title": "How to use this",
    "steps": [
      "Enter current per-person bi limit ($).",
      "Enter current per-occurrence bi limit ($).",
      "Enter net worth ($).",
      "Enter annual income ($).",
      "Enter typical passengers at risk per trip.",
      "Read your recommended per-occurrence limit on the right — it updates as you type.",
      "Hit Share to keep the scenario or send it to someone."
    ]
  },
  "scenarios": [
    {
      "name": "Conservative",
      "description": "Lower-end numbers — what if things land soft?",
      "values": {
        "currentPerPersonLimit": 50000,
        "currentPerOccurrenceLimit": 175000,
        "netWorth": 180000,
        "income": 55000,
        "typicalPassengers": 1
      }
    },
    {
      "name": "Typical",
      "description": "Defaults — the most common real-world setup.",
      "values": {
        "currentPerPersonLimit": 100000,
        "currentPerOccurrenceLimit": 300000,
        "netWorth": 300000,
        "income": 90000,
        "typicalPassengers": 2
      }
    },
    {
      "name": "Ambitious",
      "description": "Higher-end numbers — what if things really pop?",
      "values": {
        "currentPerPersonLimit": 150000,
        "currentPerOccurrenceLimit": 475000,
        "netWorth": 480000,
        "income": 145000,
        "typicalPassengers": 3
      }
    }
  ],
  "limitations": [
    "Results are estimates before tax, fees, and inflation unless an input explicitly covers them.",
    "Rates are treated as fixed for the whole period — variable-rate products will drift from this projection.",
    "This is educational maths, not financial advice. Check anything contractual with the lender or your accountant."
  ],
  "faq": [
    {
      "q": "What do the three numbers in a limit like 100/300/100 mean?",
      "a": "The first number is the maximum paid per injured person ($100,000), the second is the maximum paid per accident across all injured people combined ($300,000), and the third is property damage coverage for the other party's vehicle or property ($100,000). If you injure three people badly, the $300,000 gets split among them, capped at $100,000 each."
    },
    {
      "q": "Why are state minimum limits usually not enough?",
      "a": "Many states still require minimums like 25/50/25, set decades ago and rarely adjusted for medical cost inflation. A single ICU stay after a car accident can run $50,000-$150,000, and that's before lost wages or a lawsuit for pain and suffering. Anything above your limit becomes your personal financial responsibility, which is why this calculator flags the gap explicitly."
    },
    {
      "q": "How does this interact with umbrella insurance?",
      "a": "Umbrella policies require you to carry specific minimum underlying auto liability limits, commonly 250/500/100, before they'll issue coverage on top. If your auto limits are too low, you're not just exposed on the auto side — you may not even qualify for the umbrella coverage that's supposed to be your safety net."
    },
    {
      "q": "Does raising liability limits cost much more in premium?",
      "a": "No, and this surprises most people — going from 100/300/100 to 250/500/100 often costs only $5-$15 more per month, because higher limits mainly get triggered by rare, severe claims rather than everyday fender-benders. The marginal cost per additional dollar of coverage drops sharply as you move up in limits."
    }
  ],
  "related": [
    "https://www.revenuelab.fyi/toolbox/gap-insurance-breakeven",
    "https://www.revenuelab.fyi/toolbox/umbrella-policy-sizing"
  ],
  "license": "CC-BY-4.0",
  "citation": "RevenueLab — Auto Liability Limit Adequacy Calculator (https://www.revenuelab.fyi/toolbox/auto-liability-limit-adequacy)"
}