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Tips on Deciding How Much Auto Insurance Coverage You Need

It’s never easy to decide how much auto insurance coverage you need. Nowadays, many drivers simply settle for the state minimum car insurance, and others prefer the security of maximizing their auto insurance limits. But in truth, how much auto insurance coverage you need is a personal decision that depends on your financial situation and your comfort level. What follows are some tips to help you decide how much auto insurance coverage is right for you.

  • Always respect your state minimum car insurance requirement. To be honest, you don’t have a choice when you get auto insurance coverage. But if you relocate during the term of the policy, it’s a smart idea to review your auto insurance coverage to make sure your coverage matches the minimum of the new state. If it doesn’t, you could be in real trouble in the event of an accident if you don't meet the state minimum car insurance requirements.
  • Maximize auto insurance coverage for your budget. For anyone who’s been involved in a serious car accident, it’s clear that you simply cannot get enough coverage. Even if you weren’t at fault in the previous incident, you’ll have a good idea of the damages and costs involved in an accident—especially if it is your fault the next time. For anybody who’s suffered the trauma of a serious accident, getting maximum auto insurance coverage provides peace of mind.
  • If you have dependents, amp up your auto insurance coverage and limits. First of all, if you’re incapacitated or worse due to an accident, you want to make sure your dependents are taken care of, even if you cannot provide a salary for a certain amount of time. But even if you’re okay, the damages incurred due to an accident can exceed your financial capacity if you’re liable and a victim sues you. To avoid the nightmare scenario of being accountable beyond your financial limits, it’s a smart idea to get as much auto insurance coverage as possible for your families' needs.
  • Keep your prized vintage possession safe. Some drivers only drive exotic or vintage cars. But no matter how much fun you may have driving them, it’s important to realize that they may be expensive, or even impossible, to repair or replace. If this is the case, the more auto insurance coverage you have, the more likely you’ll be able to repair or replace your prized possession.
  • Consider the kind of traffic you regularly drive in. If you live in a rural area with minimal congestion, you’re most likely exposed to a lower accident rate than if you live in a highly populated area with maximum congestion. Assess how many accidents you see on a weekly basis and adjust your auto insurance coverage accordingly—but make sure your monthly premiums don't stall your budget!

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