How Much Auto Insurance Do I Really Need?

For anyone who owns or operates a motor vehicle, an auto insurance policy is a key part of protecting yourself, your property and others on the road. In addition to its coverage benefits, auto insurance is also usually required by law. However, it’s also important to understand your optimal policy in order to avoid paying for coverage you don’t need. 

The agents at RCU Insurance Services work with over a dozen carriers to help clients in the Santa Rosa area understand their auto insurance needs and find suitable policies.   

What Coverages Do I Need? 
Auto insurance comes in many forms and the various coverages can create confusion for policyholders. When assessing your policy, it’s necessary to understand what losses and damages will be covered. Frequently purchased coverages include: 

• Liability coverage—This coverage is generally required and provides protection if you are responsible for another party’s damages and losses, such as:
  • Bodily injury—If you are liable for another party’s injuries, your policy can help pay for medical treatment, lost income and funeral costs.
  • Property damage—If you are at fault for an accident that damages someone else’s vehicle or property, your insurance may render assistance for repair or replacement costs.
• Medical payments (MedPay) coverage—If you or your passengers are injured in an accident, this type of coverage may be necessary to help pay for resulting medical expenses.
• Collision coverage—If your vehicle is damaged in a collision with an automobile or object, such as a tree or building, this coverage can help pay for repairs.
• Comprehensive coverage—If your vehicle is damaged by an incident other than a collision, such as fire, theft, vandalism, or severe weather, your insurance can help pay for the damages.
• Uninsured/underinsured motorist coverage—If another party is responsible for an accident but lacks adequate insurance, this coverage can ensure you are not stuck with the bill for resulting medical treatment and property damage. 

• Location—Insurance requirements may vary based on what state you live in. For example, while liability coverage is legally required in every state except New Hampshire, only 22 require uninsured/underinsured motorist coverage.
• Other policies—Certain components of an auto insurance policy may be less important depending on other insurance coverages you may have. For example, PIP may not be necessary if you have good health insurance.
• Vehicle value—The value of your vehicle could play a role in determining your coverage needs. For instance, a vehicle with low cash value might not make it worth it for you to purchase comprehensive or collision coverage.
• Financial situation—Depending on the resources available to you, certain coverages, such as collision and comprehensive, may be less necessary. For example, those who can afford to pay out of pocket for a new vehicle may choose not to pay for the aforementioned protections. 

Get the Right Coverage 
As you compile your insurance portfolio, it’s necessary to understand exactly what is included in your coverage and what may not be. In regard to auto insurance, many factors must be considered before you should decide if a policy is right for you. 

The experts at RCU Insurance Services are committed to helping drivers assess their auto insurance needs. Together, we can tailor optimal coverage to provide the protection you need. Contact us today to learn more. 

Learn more about auto insurance. 

 

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.