Why Should I Get More Car Insurance than My State Requires?

As a licensed driver, you are legally required to carry car insurance to protect yourself and other drivers in the event of accidents. There are varying levels of car insurance that you can choose to carry on your policy, but everyone is subject to the minimum requirements established by the state government. These requirements vary from state to state; and if you are like most people, you no doubt wonder whether you should stick with the minimum coverage or opt for a better policy.

What are Minimums?
The minimum coverage established in each state tends to vary, but generally speaking the average minimums are $25,000 per injured person, $50,000 per accident, and $10,000 for property damage. As a perfect example of varying coverage minimums, drivers in the state of Pennsylvania must meet average minimums that include $15,000 per injured person, $30,000 per accident, and $5,000 for property damage.

Minimum coverage seems like a good idea for many motorists because it appears cost-effective. Drivers will select minimum coverage to save money compared to more extensive coverage, or because they believe they will never be in an accident.

Why You Should Buy More
When you move to a new state or consider a new car insurance policy, it is important to take time to look at the state minimums and carefully evaluate the benefits of buying more coverage than those state minimums. There are a number of good reasons for buying a more comprehensive policy.

First and foremost, you could suffer severe financial distress as a result of accidents. Moderate-to-severe accidents easily surpass $100,000 in damages and bodily injury, depending upon the number of vehicles and people involved. When your car insurance coverage limit is surpassed, you are financially responsible for those excess costs. If other parties pursue you through legal channels until the debt is paid, you could be forced to liquidate your assets or face wage garnishment.

Secondly, you could be charged exorbitant amounts for extra services that enhanced insurance policies offer as free (or generously reduced) extras. A classic example of an extra that is free on enhanced policies is roadside assistance. If you opt for a minimum policy, you’ll be paying all of those expenses out of pocket, on the spot. An enhanced policy can actually save you money in this instance.

Finally, it is possible to double your coverage in many cases without paying massive fees to do so. The vast majority of people who opt for minimum coverage do so to save money each month on car insurance. However, it is possible for many drivers to spend as little as $10 more each month and receive double the level of coverage in the process.

An Additional Tip
If you need to find a way to lower your car insurance costs each month, consider asking your current provider for a higher deductible rather than cutting back on the coverage levels within your policy. You will be responsible for more money upfront when involved in an accident, but you will pay less each month and maintain higher coverage levels in the process.