Four Reasons Why Drivers Need to Think About Mandatory Auto Insurance

If you’re like most folks, you’ve never really considered your mandatory auto insurance choices. Car insurance companies set insurance premiums, so obviously they know what most folks like and don’t like concerning them. Mandatory auto insurance isn’t the same as mandatory health insurance, which isn’t available to individuals who need it anyway. Here are a few quotes to consider before making that important decision.

Collision – The minimum amount of coverage required by most states for your vehicle is liability coverage. The lower the amount of liability coverage, the less you’ll be paying for your comprehensive and collision coverage. You may also want to choose to include uninsured motorist and underinsured motorist provisions in your policy. Remember that if your vehicle is in an accident, the other party’s liability coverage will pay for at least some of their medical bills, so you want to make sure you’re covered enough for this.

Bodily Injury – It’s always best to carry more than just bodily injury coverage in any state. Some states require you to carry no fault auto insurance, which means if you’re hit by someone without insurance, you’ll be responsible for all medical bills. Most people would opt for at least bodily injury coverage, but it’s wise to have the additional insurance coverage, just in case. There’s also no good reason not to carry at least third-party liability insurance. This type of insurance will cover the medical expenses of those passengers who were in the car when you got hit, as well as anyone who was in the car when you caused an accident.

Premium Increase – While many states are increasing the minimum coverage limits, some are keeping the rates the same. If your plan was recently increased and you want to know why you’re being charged a higher premium rate, call your insurance company or look up the new rules. You may find that your old policy doesn’t cover things like rental cars and personal injury protection, which means you should probably get those things added to your plan. If you don’t have them, now may be a good time to think about getting them.

State Mandate – Some states actually have laws requiring drivers to have certain types of coverage, and they’re actually written into state law. These laws vary from state to state, and you need to make sure that you’re obeying the law. In many cases, these laws are designed to protect uninsured drivers, which means that drivers without sufficient coverage can wind up paying the costs of repair or loss out of their own pocket, regardless of whether they’ve been insured. If your state has such a law, you should probably think about making sure your auto insurance policy includes it.

Higher Premium – Last year, there was a new law in New Hampshire that took effect immediately. The law requires auto insurance companies to charge higher rates to younger, inexperienced drivers. Although this seems unfair, most experts agree that the higher rates are necessary to protect New Hampshire’s valuable roads and motorist safety. According to the National Highway Traffic Safety Association, every year, 20 percent of car accidents involve a student driver that is either uninsured or underinsured. With all of the concerns about the economy and the state of the economy in particular, it’s easy to understand why insurance companies are feeling the pinch.

Author: Trimwell