What Types of Auto Insurance Coverage Do You Really Need?

Let’s continue talking about auto insurance, since it’s a mandatory part of our lives.  We already know that every state requires you to purchase bodily injury and property damage insurance; here are the other components of auto insurance that you need to consider as well.

Uninsured/Underinsured Motorist Coverage – Some states require you to purchase this type of auto insurance, which covers medical bills, rehabilitation or funeral costs for you and your passengers if you are injured by a driver with little or no insurance, or someone who flees the scene of the accident.  Given the sadly large number of uninsured drivers out there, this coverage is well worth the few dollars it adds to your total car insurance premium.

Personal Injury Protection (PIP) – Some states require PIP; others don’t, and some are changing those rules right now.  This coverage provides for lost wages and medical care if you are in an accident.  The last time I was in an accident, my company health insurance paid for everything, so this would not have helped.

Collision Insurance – This will pay for the repairs to your car if there’s an accident, regardless of fault.  Determine whether or not your vehicle costs enough to warrant this type of insurance.  Most cars do, but it’s still something to think about.

Comprehensive Insurance – If your car is stolen or damaged due to something other than a car accident, comprehensive coverage will pay for it, to the limit of the policy.  Again, ask yourself if your vehicle is worth paying for this coverage.

One of the most popular ways to save money on auto insurance is by increasing the deductibles for comprehensive and collision insurance coverage.  Most quotes default to a $250 deductible, but ask about raising it to $500, or even $1000, and see the difference it makes in your automobile insurance quote.