December 19th, 2008

The level of auto insurance that someone might need depends on the financial circumstances of the individual concerned and the cost of the car involved. Take for example someone who has a brand new $50,000 motor, it would be sheer folly to do anything other than take out one of the best auto insurance policies available and the cost of the auto insurance is likely to be insignificant when considering the overall annual cost of the car.

However, if you have a car that is nearing the end of its life, have a low cost car and previous claims or are a new driver then the cost of the auto insurance versus the benefits you might receive need to be given greater consideration. Comprehensive auto insurance premiums are likely to be disproportionately high for older vehicles, new drivers with low cost autos or drivers with accident history.

Whatever your circumstances you are legally obliged to take out a basic level of auto insurance that will cover you against third party claims and given the level of damages awarded seem to be increasing out of control then my advice would be to get the best possible third party liability auto insurance cover that you can afford.

The legal requirements for auto insurance does vary from state to state so you’ll need to clarify the level of cover you require when taking out auto insurance but only insuring to the legal minimum isn’t necessarily the best choice to make.

If you have a lot of money sunk into your car or your auto is leased then you really should take out comprehensive and collision auto insurance to cover you for things such as fire, theft, acts of god or collisions that are your own fault.

If you live in an area where cars are regularly vandalised you might want to consider comprehensive auto insurance when perhaps you wouldn’t have otherwise done so. The cost of your auto insurance will generally be higher if you live in such an area but that is something you have to weigh up against the cost of repair.

Personal Injury Protection is something that everyone should consider as this element of your auto insurance will cover medical costs associated.

Despite legal requirements some people still persist in driving around without auto insurance leaving the others with a need to insure against the uninsured motorist. Uninsured auto insurance will cover you for damages in the event of an accident with an uninsured motorist. Again, insurance that everyone should give serious consideration to given an auto accident could leave you unable to work or your family without any means to earn.

If you want a more comprehensive auto insurance policy but want to limit the cost then you could look at opting for a higher level of deductibles. Deductibles are the amount you would have to pay before you could make a claim against your auto insurance policy and generally, the higher level you agree to the lower your auto insurance premiums.

Comment (0)

Response to “What Level Of Auto Insurance Do You Need?”
Jona U
December 19th, 2008 - 3:04 pm

When you buying an auto insurance for an used financed car?
I know you must get the full coverage.. but what exactly does that mean?

can you get the lowest level of everything and choose the expensive deductible as long as you have covered all that are needed for the insurance required?

or must you get the "premium coverage" with like 100000 for motorist and stuff which isn't worth it.



Just ME
December 19th, 2008 - 8:06 pm

you can get basic comprehensive with a low or high deductible. But keep in mind if your car is damaged then you would have to pay that larger deductible before they pay anything.

Also, some have specifics (check your contract) where you have to have only like a $500 deductible or soemthing.
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phythic
December 19th, 2008 - 8:08 pm

It depends on who gave you the loan. My dad cosigned for me and because of his great credit score, they let me get high deductible.
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Alex
December 19th, 2008 - 8:10 pm

Legally you have to have liability coverages, per your loan company they require you to get comprehensive and collision coverages. Liability coverages cover damages and injuries you cause to other people or things by fault of your own, or defend you if its not your fault and someone is claiming it is. You can pick any limit you like however keep in mind that if you pick a $5,000 property damage limit, and total a car worth $25,000 you will owe $20,000 yourself. Or if you pick $20,000 bodily injury and someone sustains $100,000 worth of medical bills, you owe anything over the $20,000… so bear that in mind when picking limits. As for comprehensive and collision, these basically pay you the cost of repair if your vehicle is damaged (less your deductible) regardless of fault. The loan company has you get this so they can make sure their car is protected. They may require a certain deductible but you’d have to ask them that.
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stewiegriffin4president
December 19th, 2008 - 8:12 pm

You need to ask the finance company what their insurance requirements are. Many finance companies have a cap on how high your deductibles for Comp and Collision can be and require a specific amount of liability coverage as well. So you should check with them first, and preferably ask them to give you something in writing showing how much coverage they require, then talk to your agent about getting the right amount of coverage on the car.

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Workin’ in insurance



mariko m
December 19th, 2008 - 8:14 pm

Try getting an online insurance quote It's free and quick to do. http://www.autoadviceonline.com/Free-Auto-Insurance-Quote.html

Hope it works out
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