How Much Auto Insurance Do You Actually Need?

The streets are far from being a safe place. More than 6 million car accidents take place only in the U.S., on an annual basis. Do you still think that your excellent driving skills could get you out of trouble in any given set of circumstances? Think again. Even professional drivers need to take a few measures of precaution to limit their losses in the event of an accident. To be honest, anything could happen.

You could get involved in a car accident and suffer severe injuries requiring more than a few days of hospitalization. Moreover, your car could be vandalized when you least expect it. A huge tornado could devastate your car and force you to replace it. So the question is this: could you afford to cover all these costs out of your own pocket? If the answer is no, this means that you have to invest in an excellent auto insurance policy, tailored to your needs and budget.

Most importantly, auto insurance is a mandatory requirement in most states, so people who neglect its crucial importance and choose to live without it expose themselves to significant penalties, including huge fees or jail time.

How Much Money Should You Invest in Auto Insurance?

To discover the type of policy that may work best for you, you should get familiar with the main components comprised by car insurance: liability coverage, bodily injury liability, property damage liability, personal injury protection (PIP), collision, comprehensive and uninsured or underinsured motorist coverage. All of these elements are very important. Each enables you to cope with different types of expenses that would otherwise impact your own financial situation if a traffic accident were to disrupt your balance.

To get one step closer to the best policy for you, in terms of hands-on advantages and costs, start by getting cost-free car insurance quotes online. This is the most effective, simplest method to compare rates and still go for the most generous auto insurance policy that you can afford.

Next, you should know that every single auto insurance policy represents a sum of factors. All of them are extremely useful and come in handy in different situations.

For instance, collision covers the costs triggered by repairs demanded by your very own wrecked car. Comprehensive coverage brings you the financial support that you demand, when your car is vandalized, stolen or impacted by a natural or man-made disaster. PIP gives you the chance to pay the medical bills recorded by you and your passengers. It also covers lost wages, so this policy comes in handy if the injuries sustained in a recent accident stop you from going back to work for a certain period of time. Uninsured or underinsured motorist coverage proves its utility when you get hit by a driver who has minimal coverage or doesn’t have coverage at all. Since there are many uninsured drivers who don’t hesitate to get behind the wheel, investing in this type of policy is always a good call. Liability coverage is something that you definitely want to have when you hit another car. It covers the expenses associated with the injuries and financial losses of your victims, but it won’t cover the ones reported by your passengers.

How Much Money Should You actually Spend on Car Insurance?

This is a tricky question, because there is no right or wrong answer. Nobody can tell you for sure how much is too much when it comes to auto insurance. Nonetheless, you can follow a few simple tips to make an educated decision and preserve your resources at the same time.

1)      Identify and analyze the minimum car insurance requirements of your own state. Requirements vary a great deal from one state to another, so you should do a little research on your own before making a final call. In some cases, the minimum coverage required in your state could be all you may actually need to be able to sleep at night and keep risks at bay.

2)      Make sure you are presently covered for an amount of money matching the overall value of your belongings.

3)      If you want to opt for a policy with a low premium, it may be a good idea to pay for collision coverage that has high deductibles. This basically means that you would be willing to pay the costs triggered by routine repairs out of your own pockets.

There are various other things that you should factor in, when it comes to selecting the right auto insurance policy for you. For instance, policies that cost less than you would expect, like uninsured or underinsured motorist coverage, can offer you tremendous benefits when worst case scenarios become real (for coverage worth 100,000 dollars you’d have to pay around 40 dollars per year).

Usually insurance experts advise people to go in favor of higher deductibles simply because they lead to lower premiums. Think about it: it actually makes sense for you to take 500 dollars out of your bank account to pay for minor auto repairs every once in a while. You’d rather do this than spend 50 dollars on a monthly basis, whether your car needs fixes or not. In other words, if you file a claim more often than you actually should for the tiniest imperfections that are bothering you, your premium will inevitably go through the roof.

Do the math, find out how much money you can direct towards your auto insurance on a monthly basis, check out your state’s car insurance-related requirements and make the best decision. If you want to take a closer look at accurate estimates, get free, car insurance quotes online, spot the best deals launched by different carriers and get in touch with some of the most respectable insurance agents–who could walk you through the entire process. In the end, remember that the key is to purchase auto insurance that enables you to minimize risks, while also giving you peace of mind in knowing that your financial balance won’t be affected by a potential unpredicted event.