How Much Car Insurance Coverage Does One Car Need?

Insurance companies offer polices with options. Sometimes, there’s too many options when purchasing auto insurance. How much car insurance do I need?

It is recommended that every vehicle on the road have insurance and this is a requirement by the law. Every state in America has its own minimum required amount that one should buy. However, there are some states that do not require one to have auto insurance at all.

The question is how much car insurance do I need? Is the state minimum enough or should I get more? If you like taking risks without breaking the law, then probably the minimum required insurance could be enough, but if you want to insure your car against any damages, you will have to go for more.

Auto Insurance

Auto insurance is made of a number of policies that cover you in their own unique ways. To get the right amount for the policies you can request for a personal auto quote from your insurance agent. To answer the question on how much car insurance you need, then read on to find out the different types of policies, what they offer and in the end, the type of coverage you can buy.

1. Liability Insurance

This insurance is also known as the third party insurance and it covers you if you hurt someone or damage their property with your car. The money is paid to the third party and not to you.

It will cover hospital bills, any legal fees, and settlements cost that are up to your policy limit. There are two types of liability insurance:

• Property damage liability: this policy will pay for the damage caused by your car on any other car or property if you are at fault.
• Bodily injury liability (BIL): this policy will cover any medical expenses incurred by the person or people that got injured in the accident where you were at fault.

Liability insurance does not cover the people in your car even if they have sustained any injuries due to the accident.

2. Personal Injury Protection (PIP)

PIP policy will cover all the medical expenses incurred after an accident whether you were at fault or not. It also covers the medical bill of anybody who was in your car at the time of the accident. It is also known as no-fault insurance.

This policy is solely for your own good. Some insurance companies also cover lost wages under this insurance should you be forced to take a sick leave of absence from your job.

3. Collision Insurance

If you love your car so much, then you should consider buying this policy. It will cover your car against any damages from an accident regardless of who was at fault. At times the at-fault insurance takes a long time to repair damaged cars or replace them and if you have your own safety net then you will be bothered by them.

4. Uninsured/Underinsured Motorist Coverage

What happens when you get in an accident with a car that has no insurance coverage? Well, you will not have to worry about that if you buy this policy.

This insurance policy will fully cover and compensate you if you get hit by an uninsured or underinsured driver. It will cover your medical bills, lost wages, and more depending on the insurance company.

If you have a health insurance cover and collision insurance, then you can choose not to get this policy, but if you can afford it, you can as well still get it.

5. Comprehensive Insurance

Not all damages to your car can be as a result of an accident or a collision. If you have ever witnessed a car being vandalized by a group of rioters or protestors, then you will appreciate this cover. Many people lose their cars and money to vandalism.

The comprehensive insurance will cover any other non-accident related damage to your car like vandalism, theft, and damages caused by weather. This cover is highly recommended if your car is less than 10 years old if you cannot be able to repair or replace your car, and if you live in an area that is prone to hail, flooding, and tornadoes.

These policies are recommended for every car, however, after buying the minimum according to your state, you can choose whether to have these other policies on not. Bottom line, if you are in an accident and you are at fault, you will be required to pay whether you have insurance or you don’t.

How Much Auto Insurance Do You Need?

Well, let us take a look at the levels of coverage. The first two numbers refer to the BIL, the first number is the limit per person, the second is the limit per accident and the third number is the property damage liability.

If you have an old car, don’t drive much, are a student, or on a tight budget then the recommended coverage is 50/100/50. Middle-wage incomers can go for a 100/300/100.

• The average cost of minimal insurance per state is $ 562
• If you choose 50/100/50 it will cost you an average of $640. This means it is just another $78 a year
• Should you change to 100/300/100 from 50/100/50, the cost would be $714.

Therefore, you now have a rough estimate of how much insurance you can pay with your new automobile.

Asking Yourself How Much Car Insurance Do I Need? Consider What Is Necessary First

Full coverage car insurance is not cheap and the question of how much car insurance do I need will depend on what you can afford. After getting the minimum insurance, consider what is important to you and what you can afford so that you can be able to decide on the policy to get.

Start with very important policies. Remember, it is safe to buy more than the minimum.

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~ by velofinds on April 29, 2019.