We constantly see ads on TV regarding the lowest rates for car insurance. The absolute lowest rate also means limited coverage. It means that you have the lowest possible liability coverage, no Med Pay and likely no collision coverage. What you should be concerned with are what are the rates on the coverage you need.
When deciding what coverage to purchase you need to look at limits that will properly protect you in the event of a major accident that is your fault. If you cause an accident that results in hundreds of thousands of medical bills to someone else and you have only the minimum limits of liability coverage ($30,000) then your personal assets are at risk to satisfy a judgment by the person you injured. Depending on how great your personal assets are you may even want to talk to your insurance agent about an Umbrella Policy. The more you have financially, the more you potentially have to lose in this situation if you don’t have adequate insurance coverage.
Purchasing higher limits in liability coverage will also give you the opportunity to purchase more Uninsured and Underinsured Coverage. These coverages protect you in the event that YOU OR YOUR FAMILY are injured in a wreck that is someone else’s fault and they have little or no liability coverage. Many people worry that they will be injured by an uninsured driver. This is the way to put that worry to rest.
Med Pay coverage is very cheap and you should always buy the maximum amount your insurance company will sell you. It is non-fault based insurance that that will pay for medical expenses you incur in an accident regardless of who is at fault in the accident.
Finally, many people drop collision coverage on their car when the car is paid for. By doing so, you do save on your coverage, but if you are then in an accident that is your fault or no one’s fault, such as a deer running out in front of you, you are on your own to fix or replace your car. It is also great to have collision insurance in cases where someone else is at fault in the accident and the other insurance company is giving you a hard time about the property damage. If you have collision coverage you can always get your insurance company to cover your property damage and let the two insurance companies fight it out over liability. If your insurance company wins in the end you will get your deductible back. No one wants to pay more than they have to for insurance coverage, but try to make sure that saving a few bucks on your coverage doesn’t leave your coverage lacking when you need it.