Auto insurance is quite a portion of your budget. There are different policies that at your disposal from which you select which ones to buy. Following are some of the policies available commonly.
Liability coverage: – As per this policy, all the expenses and damages shall be covered when you are at fault in an accident.
Bodily injury liability: – When you are at fault in an accident in which other people are injured, this policy pays for the injuries of the other people.
Property damage liability: – This policy pays for the damages to the other car that are incurred during an accident in which you are at fault.
These policies are for the coverage of another party. While following policies exist to compensate for your losses during an accident.
Personal injury protection: – This policy pays for your and other members’ sitting in your car medical bills.
Collision: – As per this policy all the necessary repairs to your car are made after it has met with an accident.
Comprehensive: – This policy covers costs associated with damages that occur to vehicle due any factor other than accident such as theft or vandalism.
With so many policies available just how much auto insurance do you need? First of all you need to get the minimum level as required by your state. This level is different for different states. For instance, in the Texas minimum level is 30/60/25 while in New Jersey it is 15/30/5. In most cases the minimum level is insufficient to pay for serious damages. It is just enough to make sure that you are driving legally. Very few people stick to this minimum level. For instance, if the car is not the primary household Car, is seldom driven and is quite an old model yon go for minimum level.
How much auto insurance you need depends a lot on your financial status. An insurance level of 50/100/50 is good enough for students or retired people, who drive less, are generally tight ion budget and usually own a second hand old car. An insurance level of 100/300/100 is what most of the people opt for. This is appropriate for middle class people who have a sufficient level of savings in their account for most of the times. However, if you belong to the upper class of society, have a considerable amount of assets and luxurious cars 250/500/100 is the level that shall suffice.
Uninsured motorist coverage is a component of insurance that some people can skip. Those who have health insurance and are covered by collision insurance they can opt for not carrying uninsured motorist coverage. However, if you can afford it is always prudent to have uninsured motorist coverage. It also helps in bringing down financial losses from deductibles and coverage gaps.
Hence, how much auto insurance you need depends a lot on the condition of your car, your driving experience, your residential state and above all your financial standing.