How Much Car Insurance Do I Need? The answer varies for each individual set of circumstances, but for most people, the state required minimum isn’t enough.
A common amount of bodily injury liability coverage is $100/300. That’s up to $100,000 of bodily injury protection per person and $300,000 per accident. Greater amounts might be better covered with an umbrella policy. I have joked about the state minimums for property damage on several other pages. Don’t skimp on liability insurance. It doesn’t add a lot to the cost and it’s rare that anyone is even going to bother to sue for the $10,000 that most states set as a minimum anymore. If someone with a good reason sues you for $50,000, and you only have $10,000 of coverage, your insurance company isn’t going to put a lot of effort into your defense. They’ll pay their $10,000, you’ll be on the hook for the rest.
In today’s world, $10,000 worth of property damage insurance won’t cover much and you should consider at least $50,000. Even a bumper thumper can push the lower limit and damage can really run up in a multiyear crash. Drive careful even with the $50,000 amount, that’s still less than the replacement cost of luxury SUV.
Remember that collision and comprehensive covers repairs or replacement to your car if it’s stolen or damaged. Both are generally required if your car is leased or financed, and it might still be a good idea if it’s paid off. Balance the cost of the insurance against whether you would be able to afford to pay the entire cost of repairing or replacing the vehicle. For an older vehicle where the book value is low, this insurance might not be worthwhile.
Uninsured and Underinsured Motorist Coverage is usually set at the same limits as your other insurance. This is important coverage as there are a lot of uninsured drivers out there. This feature covers you even if it’s their fault.