How Much Car Insurance Do You Really Need?

Whether you are moving to California or have a new driver in the family, having auto insurance is required by law. Auto insurance protects you from all the headaches like paying out-of-pocket for medical bills, car repairs, and legal fees you would have to deal with without it. 

There are many different types of coverages required and some that are optional. It’s good to be in the know, so you have enough auto protection for you and your family, especially if you have a new driver. But how much car insurance do you really need, and what about the minimum requirements? Let’s get started on the essential auto insurance details that will help you get on your way to understanding what is best for you.

Why Is Car Insurance Important?

Auto insurance is a must-have because it protects your car and your finances. If you get in an accident and are at fault while uninsured, you’ll have to pay a large sum of money and might need to dip into your savings to cover the costs. Yikes! Most states require car insurance, and driving without it would be breaking the law. One minute you are on the highway with no insurance, jamming out to a song you love. The next minute, you face penalties for being uninsured for an accident you caused. You don’t want that to happen! It’s best to have coverage before taking your ride out on the road and belting out your favorite tunes.

Without insurance, you’ll be responsible for paying hefty fines, court fees, and possibly hundreds of thousands of dollars for repairs and other expenses. In addition, you might get your car impounded and your registration suspended. What a mess! There is no fun in that! 

When you have the right coverage, like liability insurance, it will pay for covered losses, medical bills, vehicle damage, and legal fees. Liability insurance offers two forms of protection. There are other types that you might need in addition to, like uninsured motorist bodily injury coverage and uninsured motorist property damage coverage.

What are they, and what do they cover?

  • Bodily Injury Liability Coverage: This type of protection covers medical expenses, loss of wages, pain and suffering, and financial costs for a third party.
  • Property Damage Liability Coverage: Property Damage Liability commonly covers the cost of repairs if you caused the accident and covers other property expenses, like damage to a fence or a building.
  • Uninsured Motorist Bodily Injury Coverage: Uninsured Motorist Insurance protects you from spending your savings on injuries you didn’t cause from a collision. This type of coverage helps pay for medical bills, funeral expenses, pain and suffering, and lost wages. If an uninsured motorist causes the accident, any injury you or your passengers sustain will be covered. Uninsured Motorist coverage is so important! You do not want to foot the bill for medical expenses because of someone else’s negligence.
  • Uninsured Motorist Property Damage Coverage: Uninsured Motorist Property Damage Coverage helps pay damage to your vehicle or property if it’s the other driver’s fault during an accident and they are without proper insurance. In California coverage is offered up to $3500. If you already have collision coverage on your vehicle you might want to add a collision deductible waiver instead of uninsured motorists property damage so that you don’t have to pay your deductible if your vehicle is damaged by an uninsured motorist.

How Much Bodily Injury and Property Damage Insurance Do I Need?

By California law, the minimum coverage required for bodily injury liability is $15,000 each person and $30,000 each accident and for property damage is $5,000. Your insurance company pays up to the limit listed on your policy. This is the minimum amount to meet the law, but might not be an adequate amount of coverage for most people.

Should I get More than the Minimum California Insurance Requirements?

Even though California law has minimum requirements, it doesn’t mean that’s enough for you. If you set your limits too low, then you could be putting yourself at risk. It’s essential to have the highest liability coverage you can afford and carry other coverages to give you and your vehicle the best protection. Without enough coverage, you’ll be financially responsible for paying the cost that isn’t covered. Speak with an insurance professional who can guide you successfully to determine what is best overall for you and your family, including coverage and rates. If you back your car into a Tesla in the parking lot, the repair bill alone might be more than the minimum limits required by the law.

Additional Types of Coverage

Other coverages might work for you as long as it makes sense for your overall needs. Many additional options may cover a flat tire, a cracked windshield, and other collision issues. Below is a detailed explanation of each one.

Collision Coverage

Collision coverage pays for repairs or replaces your car if it’s hit by another vehicle. It may also help with the cost of repairs if you hit another car or object. That means you can use it whether you’re at fault or not. The most it will pay is based on the actual cash value of your vehicle. One thing to note is that collision insurance is not required by law. However, it may be required by your lender if you are leasing or financing your vehicle. If your car is paid off, collision is optional but should still be considered if you drive in high-traffic areas or want coverage to repair your vehicle if something happens.

Comprehensive Coverage

Comprehensive coverage helps pay for repairs or might cover some of, or most of, the cost of replacing your vehicle after being damaged. This covers situations like vandalism, theft, hail, flooding, fire, or hitting an animal, not in a collision.

Gap Insurance

Gap insurance covers you if you lease or finance any vehicles and owe more money than the car is worth. If your ride is stolen before the loan is paid off, gap insurance will cover any difference between the auto insurance payout and the amount still owed on the car.

Umbrella Insurance

Umbrella coverage is additional insurance coverage that offers protection that exceeds the existing liability limits. It covers injuries, property damage, certain lawsuits, and personal situations. 

Roadside Assistance

Being stuck on the side of the road, especially in extreme weather conditions for hours, is stressful and frightening. Roadside service will assist you if your car breaks down, is broken into, or runs out of gas. 

Non-Owner Insurance

Suppose you borrow a vehicle occasionally or rent a car and don’t have your own means of transportation. In that case, you might want to look into Non-Owner insurance to protect yourself if you are in an accident. This will cover bodily injury and property damage.

Medical Payment Coverage

This type of protection covers your medical bills and funeral expenses, no matter who is at fault. It doesn’t cover lost wages. If you already have health insurance, this type of coverage can help pay your out-of-pocket expenses or deductibles.

Secure Your Future With the Ultimate Auto Protection!

Driving without insurance is risky and not worth the financial headache. It’s best to talk to an insurance professional to ensure you have enough protection. Planning for the what-ifs and protecting your future will keep you from paying out-of-pocket in the event of a collision. 

For more information, call the team at Alex Rue Insurance for insurance advice, guidance, and an accurate auto insurance quote. The Rue Crew is here to help save you time, money, and the insurance hassle. We make it easier to navigate the insurance jungle.

Alex Rue