Choosing the Right Auto Insurance for You

When it comes to purchasing auto insurance, most of us try to get it over with as quickly and painlessly as possible. There is more to choosing auto insurance than simply seeing who will give you the lowest price. Taking the time to understand the basic types of insurance, the providers in your area, and your own insurance needs will go a long way to assure that you obtain the coverage that will serve you best through the years to come.

Starting with Liability

As you build your customized auto insurance policy, the best place to start is with liability insurance. This is the one type of auto coverage that everyone needs. Liability car insurance protects your assets if you are the responsible party in an accident and others are injured or property is damaged. This insurance pays medical, hospital, lost income, rehabilitative care, pain and suffering, and property damage costs to the victim. It will also pay for your legal defense if necessary.

Most states in the US require liability auto insurance and minimum coverage requirements vary. When choosing your liability insurance, remember that legal and medical expenses after an accident can easily exceed our personal assets. It makes sense to choose the largest amount of liability insurance that you feel is affordable.

Build in Comprehensive

Next, you will need to decide if you should purchase collision and comprehensive insurance. Collision insurance covers the cost of damage to your car, which is the result of an accident, no matter who is at fault. Comprehensive insurance takes care of the cost of auto damage from other causes such as theft, storms, floods and vandalism. If you are leasing or financing your car, collision and comprehensive insurance are required and your lender will determine the required amounts of coverage.

If you have a new car, which is not financed, it still makes sense to purchase this coverage to protect your investment. As your car ages and depreciates in value however, there will come a time when the cost of carrying collision and comprehensive insurance will exceed the benefits. If the value of your car is less than the sum of your premiums plus your deductible, you can do without this type of insurance.

Adding Personal Injury Protection

To protect yourself and your passengers in the event of an accident, consider medical payments insurance and personal injury protection insurance (PIP). Medical payments insurance will cover the cost of medical, hospital or funeral expenses which result from an accident for both you and any passengers in your car. PIP, which is required in no-fault states, is broader, covering medical care, lost income and replacement services for injured parties.

When you have decided which coverage you need, it is time to start learning about insurance providers. Check the customer satisfaction records of these companies, and be sure that they are financially sound with the ability to pay claims; there is more to being a good insurance provider than just offering the lowest price.

Once you have narrowed down the possibilities, it is time to get quotes. Be sure that all your quotes are for identical amounts of coverage so that you can make an accurate price comparison. Your efforts will pay off in the peace of mind you’ll achieve in knowing you have chosen the best insurance for you.