Buying a car comes with many responsibilities. Among those responsibilities, one is buying insurance for your vehicle. However, finding car insurance is not a cakewalk. It is not just about finding one at the lowest price, but the one that works best for your car.
Each year millions of consumers make decisions about insurance. It is one of the most difficult decisions we make as a consumer. Whether it is auto insurance, health, or life insurance, the options for insurance, pricing, and all can be a little overwhelming.
When you are paying for insurance, you pay for financial security. In this post, we will be discussing how to find the best auto insurance for your business. Be its liability insurance or No-fault states Auto Florida and more, knowing everything about car insurance can help in making the right choice.
Car Insurance State by State
One thing you should know about auto insurance is that it is regulated at the state level. No matter the state you live in, they have their own expectations regarding insurance and it is now mandatory at some level in every state.
Today, every driver is required to have liability coverage which can protect other people’s property and physical damage should they cause an accident.
Basic Liability Insurance
Liability insurance is a type of insurance coverage which is a necessity in every state. This type of insurance covers someone else’s expenses if you are at fault for causing an accident. In simple words, it is a type of insurance which is financial protection for other drivers.
For instance, if you are at fault for an accident, liability coverage will cover bodily injury and property damage. So if you get a miner bender but the other driver gets whiplashed your liability insurance is enough to cover the damage and the doctor’s visit of the other driver.
Your liability insurance can cover the following things:
- Bodily injury maximum for one person injured in the accident
- Bodily injury maximum for all injuries in the accident
- Property damage maximum for one accident
Each state has different minimum requirements for liability insurance. You can get additional premiums in your liability coverage, but choosing at least a minimum is important. Make sure that you have all the necessary information and the right quotes when shopping around for insurance for your car.
What if it is not enough?
It may seem as though your liability coverage is enough to cover the damage, but it is not. So what happens when you are the cause of the accident but don’t have enough coverage to handle the other person’s medical expenses?
Well, in this case, the person at fault is responsible for paying the remaining tab. Generally, the injured party opts for a court settlement. If you have no assets which can be used for payment, you might be in the clear. However, if you own a home or other assets, the injured party can plan a lien on them or seize the settlement. On the other hand, if you have a job, they can garnish your wages or drive you to bankruptcy.
This is where purchasing more than just one bare minimum of the coverage is often considered.
In some states, it can be hard to cover the medical expenses and property damage if an accident is declared “no-faults”. However, in some states, with no fault, your insurance company is required to pay the expenses of the damage and medical expenses if no one is at fault for the car accident.
Make sure that you do some research on your state laws and requirements before going into choosing your insurance coverage. No faults coverage can be extremely helpful in an otherwise very messy situation.
This is optional insurance coverage which you can add to your existing insurance policy. This insurance covers the difference between the car’s value and the amount you owe on it in the car is totaled.
For example, you buy a car that is $10,000. However, the amount is reduced to $7,000 only a year later, but you still owe $8,000 of the worth you bought it. This is where you total the car. The insurance company will be liable to pay the totaled amount, i.e. $7,000 leaving behind a total of $1,000 for you to pay. If you have gap insurance, it will cover the difference.
Gap insurance is worth it, especially if you are not putting a bit of a down payment on your car. However, make sure you can count the cost to see if the coverage is actually worth the extra expense.
Every driver in every state is legally required to have the state’s minimum amount of insurance. This is something that you need to keep in mind, especially if you move to a new state. Not just that, make sure that you have all the information to make the right decision.