How Much Car Insurance Coverage Do You Need?

Insurance Blog

Deciding the liability coverage you need depends on your financial situation, budget, and risk tolerance. Choosing your state's minimum coverage means you will pay low premiums. However, these coverage limits may not be sufficient to cover property damage and medical bills in the event of an accident.

This is why many insurance providers advise people to buy higher liability limits to protect themselves from high out-of-pocket expenses resulting from an accident.

Here is a look at some of the common auto insurance policies.

Mandatory Coverage

Most states require motorists to have bodily injury and property damage liability protection. The first coverage accounts for injuries to others caused by the insured party and other drivers included in the policy.

If you have property damage liability insurance, it will cover any harm you do to someone else's property. This includes damage to another person's vehicle and personal property like gates, mailboxes, or fences. 

Often Required Coverage

Although state laws may require motorists to have liability coverage, many drivers operate without insurance. Some drivers have insurance, but it is insufficient to pay for the costs of a serious accident. In this case, you can take uninsured/underinsured coverage for you and your family members injured in an accident or if your car is wrecked by an uninsured or underinsured driver.

Personal Injury Protection (PIP) is another form of coverage that is mandatory in states that follow no-fault insurance laws. This coverage is for injuries sustained by the driver and passengers in your car. PIP may also cover lost wages caused by injuries sustained in a crash.

Optional Coverage Options

Many auto insurance companies provide additional coverage options that aren't required by the state. However, these add-on coverage options create a policy that is suited to your specific needs. Some optional coverage options include gap insurance and accident forgiveness.

Gap insurance bridges the difference between the value of your automobile and the amount you still owe on your finance. Therefore, you won't pay the difference from your pocket to settle the loan if your vehicle is totaled, unrecoverable, or stolen.

Accident forgiveness means your first at-fault crash will be pardoned and will not affect your premium. While every insurance company doesn't provide this option, if your insurer offers it, it will help you avoid insurance cost surcharges if you cause an accident.

In Closing

When choosing the appropriate car insurance coverage, consult an auto insurance expert. You shouldn't rely on the state requirements as they don't address unique situations. Try balancing mandatory coverage with a bit of recommended and optional coverage options. 


27 December 2022

Auto Insurance:  Even High Risk Drivers Need It

About ten years ago, my auto insurance was cancelled. This took place after one too many accidents. I was now a high risk, and my provider was not willing to keep me on any longer. Since there was no way that I was going to get behind the wheel without coverage, I started checking out plans with high-risk insurers. Some were not all that great, but others offered benefits that were very close to my old plan. I soon found a provider who would accept my application, and I began to be a little more careful with my driving. If you are having trouble buying auto insurance, let me help. I'll tell you what to look for in a high-risk provider, and how to find the best one in your area. In no time at all, you'll be covered and ready to get back on the road again.