Are you paying too much for car insurance coverage per year? Full coverage on car insurance offers the best level of protection but might not be required in your state. Bodily injury liability, uninsured motorist, collision insurance and medical payments coverage are optional in some states and required in others.
What does collision insurance cover exactly? How much does medical payments auto insurance and PLPD insurance cost? It is important to know how much insurance you need before buying any policies. Are you paying too much for car insurance coverage? Find out how to get ONLY what you need today.
The subjects of car insurance coverage and various U.S. state coverage requirements are complicated to comprehend without doing thorough research. Every state except Virginia and New Hampshire requires drivers to purchase car insurance. Even Virginia requires some minimum level of liability coverage for all drivers, however. What is liability car insurance coverage and what is the minimum amount of liability insurance car drivers are required to carry?
Auto liability insurance pays for the costs to repair and replace property and vehicles damaged by your actions while operating your vehicle. The amount of damage done to a vehicle during an accident is unpredictable as is the cost of all repairs.
Not having auto liability insurance leaves you personally responsible for major, and potentially unaffordable expenses. Liability car insurance coverage also protects from more severe legal ramifications such as losing your license or going to jail.
Liability insurance car coverage limits are divided into three main categories. Liability coverage limits are indicated by three sets of numbers, such as 40/50/10. Each number represents the maximum amount in thousands your auto insurance company agrees to pay for specific damages.
The first number in the hypothetical example above indicates your insurance company is willing to pay a maximum of $40,000 for injuries to one other individual following your accident. The second hypothetical number indicates your insurance company is willing to pay a collective maximum of $50,000 to every person hurt in your accident excluding you. The third number in the hypothetical example above indicates your insurance company is willing to pay a maximum of $10,000 for damage to property caused by your accident.
How much liability coverage do you really need? The answer to this question is largely dependent upon your net worth. The answer is also impacted by state minimum requirements. Determining the amount of liability insurance you need involves comparing your state minimum with your net worth. An accident resulting in $250,000 damage might cause you to lose your home or other valuable possessions if you do not have enough liability coverage to pay for applicable accident-related expenses. If the state minimum does not cover your net worth you might need to purchase more auto liability insurance to protect your assets.
Finally, PLPD insurance is a unique type of almost fully mandatory liability insurance. PLPD stands for Personal Liability and Property Damage and has different connotations in each U.S. state. For example, in the state of Michigan, PLPD coverage includes liability, out-of-state property damage, personal protection (PPI), and no-fault personal injury protection (no-fault PIP) insurance. What is included in PLPD coverage in other states varies applicably. PLPD insurance does not include collision, comprehensive, uninsured/underinsured or mini-tort coverage in any state, however. Liability insurance also does not cover your personal medical bills or expenses to repair your own vehicle and/or property.