You face two major challenges when it comes to buying car insurance-figuring out how much insurance you need and figuring out how to get that car insurance as cheaply as possible! Since the two tend to go hand in hand it's important to understand the difference between adequate insurance coverage, insufficient insurance coverage and insurance companies that are going to hang you out to dry when you're in an accident. Once you've established that information you're going to be in a good position to sign on the dotted line for your car insurance.
There are four primary types of car insurance. The first, liability, is the only one you're likely to be required to have according to the state. Liability insurance is the insurance coverage that picks up the tab for the other drivers' expenses when you're in an accident. State minimum liability insurance requirements usually look something like this:
A/B/C
"A" represents the amount of bodily injury liability you're required to have on a per person basis if you're in an accident. This insurance will pick up the tab for their medical bills after they've been injured in an accident you've caused. Most states require $15,000 to $25,000 per person. While this might be enough in most cases, bear in mind that hospital ICU expenses can start at $5,000 per day. If you're in a serious accident you may find that your minimum liability insurance isn't enough. That's why most experts recommend you carry a minimum of $100,000 per person in bodily injury liability.
"B" is the amount of bodily injury liability you're required to have on a per accident basis. This is the maximum amount of medical and therapy bills your car insurance company will pay for everyone involved in the accident. Again, the minimum liability car insurance required by the state is usually enough, but not always. Experts suggest a minimum of $300,000 per accident in bodily injury liability.
"C" is personal property damage. When you're in an accident cars are injured, guardrails take a hit and store windows go crumbling in the blink of an eye. Since you don't want to be paying that money out of pocket you want to make sure you've got enough personal damage liability to cover it. Most experts suggest you carry between $50,000 and $100,000 per accident. The idea is to make sure you're protected, regardless of what happens out on the highways.
Some states also require you to carry uninsured motorist insurance. Again, this is going to vary according to which state you happen to live in. Studies show that over 15% of drivers out on the road (as much as 30% in some states) are driving without insurance, which can leave you holding the bill for thousands of dollars in damages if you're in an accident. Since these types of claims can take years of court battles to settle, carrying uninsured motorist insurance will let your insurance company pick up the bill for your repairs and get you back on the road as quickly as possible.
You're also going to have the option to add comprehensive and collision coverage to your car insurance policy. While not required, these will make sure your car is protected if you're in an accident (since your liability isn't going to do anything about your repair bills if you're at fault). The thing to remember is that your state minimum requirements are exactly that-a minimum. If you're going to keep your car and your fiscal resources safe out on the road you're going to want to use that as a starting point and build up from there.
About the Author:
Michael McDonough is a National Account Executive for QuoteScout.com. For more information about car insurance requirements, visit them on the web at http://www.QuoteScout.com.
