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What Is a Minimum State Auto Coverage and Is It Enough?

Did you know that in almost every state it is illegal to drive without insurance? A minimum state auto coverage is the legal requirement for car insurance in each state. These differ from state to state. Keep reading to find out more.

What Is Minimum Auto Coverage?

If you own and drive a car you will need insurance. This insurance needs to meet the minimum legal requirements based on the laws of the state. Each state has different requirements and as such, it is important that you confirm what these are depending on where you live.

For example, in Illinois, you need bodily injury liability per person and per accident, property damage liability per accident, and uninsured motorist coverage per person and per accident. When comparing quotes for auto insurance coverage look for local insurance brokers who offer a free quote online. This will give you an idea about where to start.

Types of Coverage

There are usually four basic types of coverage included in minimum auto insurance requirements. They are as follows:

– Bodily Injury Liability. This covers the other driver and/or passengers injured in an accident that is your fault.

– Property Damage Liability. This covers the damage to a driver’s car or any property damaged at the time of the accident.

– Personal Injury Protection. This covers injuries sustained by you and/or your passengers. This is regardless of who is at fault for the accident.

– Uninsured or Underinsured Motorist Protection. This protects you in the case that you are hit by someone who does not have insurance.

These vary from per person, per accident, to both per person and per accident.

Your coverages are typically expressed by a series of numbers. For example, perhaps you have seen coverage represented as 25/50/25. This means that your coverage is $25,000/$50,000/$25000 and would provide up to a maximum of $25,000 per person for personal bodily injury, up to $50,000 per accident per bodily injury, and up to $25,000 per accident for property damage.

Above the “coverages” is mentioned. This term is used because a product known as “full coverage” technically does not exist. You are considered fully covered due to the combination of the coverages you have. Most states only require that you have two coverages. These are bodily injury liability insurance and property damage liability insurance.

Is the Minimum Enough?

Deciding if the minimum enough for you depends on you, your personal needs, and how much of a potential risk you are prepared to take. If you do not have enough insurance, you will be liable to pay for any additional damages and injuries sustained by people or caused to property. At the risk of having to personally cover the costs, having more than just the minimum coverage could really save your pocket.

The minimum often does not do a very good job at protecting you. Legally you are compliant, but if you are in an accident the minimum will unlikely cover all of the costs.

How Much Insurance Do You Need?

How much insurance you need is a very intricate thing to measure. There are a plethora of factors that affect this. Factors include age, location, driving history, the type of car you drive, and your gender. You do not want to completely empty your pockets each month, but you do want to be sufficiently covered to protect you and your assets.

Consider the following when deciding how much and which coverages are best for you:

– Liability Insurance – Calculate the value of your income, assets, and investments. Find a policy that is proportionate to this amount to avoid your assets being seized as collateral in the case that you are insufficiently covered by a policy.

– Comprehensive and Collision – This cost will vary depending on the value of your car determined by age, mileage, and model. Collision protects you from all types of collisions and even potholes in some cases. Comprehensive insurance protects you against damages not caused by a collision. This includes things such as theft, vandalism, and even hail.

– Personal Injury Protection – Consider increasing your minimums or taking out PIP. It is more expensive, but also far more comprehensive than other types of coverages.

– Uninsured/Underinsured Motorist Coverage – This coverage is quite inexpensive and is a good idea to have as one in eight drivers are either uninsured or underinsured.

The minimum could be the most that you can afford, but that does not mean you have to settle for the least. Be smart about your insurance and contact a local insurance broker for guidance.

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