I dislike the word cheap, as in cheap liability insurance.  I much prefer the word, “inexpensive”. That’s because the word “cheap” implies… badly made, of shoddy materials, ready to fall apart if you breath upon it too hard.

And when it comes to insurance, you do not want a cut-rate policy that is not going to cover you when you need it. Liability insurance in particular is crucial to have, in as high amounts as you can get. This is because of the litigious society in which we live. Depending on the accident for which you are liable, the lawyers for any claimant will suck you dry. If your liability insurance is for $100,000, for example, that doesn’t matter. The lawyers will not stop at that. They will go after another $100,000 if there’s even the slightest chance that they can squeeze that from you from your kid’s college fund, your wife’s stamp collection, whatever.

So instead of cheap liability insurance, look instead for the most insurance you can purchase that is in your price range. More than that, you have to find an insurance company that will actually pay out on claims. Some have been known not to do so.

Before signing on with any insurance company, check them out. There are several websites that rate insurance companies. The obvious ones are the Better Business Bureau and your own state’s Insurance watchdog department.  (All states have them.) Find out if any complaints have been made against your prospective insurer, and make sure they’re insured by the Guaranty Association of that state. (If an insurer goes bankrupt, and if it belongs to this Guaranty Association, they will cover its claims up to $300,000.)

When it comes to liability insurance, don’t gamble. Purchase as much insurance as you can possibly afford.