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Know More About Insurance - Minimum Required Car Insurance Coverage

When drivers are looking for car insurance, a question they ask is what the minimum amount of coverage is required. Each state has a different requirement when it comes to placing insurance on your vehicle. For those who are not sure what their state requires, or if you are moving, contact your local insurance company and ask. For new vehicles, you are required to get full coverage insurance prior to driving the car of the lot.

Why car insurance is so important is because this protects you from any liability caused by having an accident. It also protects the interest of the financed property of the lien holder. Laws in many states require insurance coverage on all driven vehicles. If this law is not followed you can risk losing your license, pay fines, get a ticket, along with varying other consequences by state.

Minimum liability insurance varies with each state. However, it is especially important to educate in auto insurance numbers. For example, say that your states minimum insurance coverage reads as 20/50/30(which stands for thousands of dollars) per accident. The first number, which is $20,000, stands for the maximum amount for bodily injury for a single person in an accident. The second number, which is $50,000, stands for the maximum amount for all injuries in a single accident. The third number, which is $30,000, stands for the maximum coverage for any property damages caused in the accident.

Certain states are considered No Fault; legally require insurance companies to pay for a policyholder’s loss that are covered by the insurance. This is regardless of who caused the accident and is held responsible. There are also restrictions of any right to pursue a lawsuit in certain No Fault states for damages. For states that are not considered no fault, the insurance who covers the individual that caused the auto accident, must pay for any loss that is covered under the plan.

A few states require individuals to carry Personal Injury Protection Insurance policies. This normally includes expanded coverage of medical costs related to traffic accidents. PIP covers lost wages and similar losses. Every state varies on what types of specific protections are afforded and limits on payments for this type of auto insurance coverage.

If you are involved in an accident where the other driver is uninsured or underinsured, you are covered with Uninsured motorist coverage. The limits for uninsured motorist coverage should not be any more than your liability limits. However, they can be lower than your liability coverage. Certain states require you to sign a form if you choose to use limits lower than your liability limits. You can opt out of buying uninsured coverage, only if your state allows it. The consequences of doing this is in the case you were in an accident involving an uninsured driver, you may end up liable for paying damages out of your pocket.

These are the minimum car insurance requirements that everyone has to invest in. It’s always better to be prepared by purchasing more than just the minimum insurance required by your state.

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