How to Get the Best Car Insurance Policy
Jul 01 2020
Many factors make up a policy, so even if you go through the same company and agent as a friend, it doesn’t mean you’ll get the same price. Those factors include what kind of car you drive and what coverage limits you want. Your bundle of coverages helps protect you, whether you or someone else causes an accident. Because, let's be real – life happens.
Here are the top 8 types of coverage to consider:
- Liability coverage does not have a deductible and pays for accidental bodily injury and property damages you cause to others. Injury damages include medical expenses, pain and suffering, and lost wages. Property damage includes damages to property and automobiles. This coverage also pays defense and court costs. Each state has a required minimum amount, but we recommend limits of at least $500,000 to protect your assets and future wealth.
- Personal injury protection (PIP) coverage pays medical expenses for the insured driver (regardless of fault) for treatment due to an auto accident. Many states, including North Dakota and Minnesota, require the coverage and have enacted laws permitting auto accident victims to collect directly from their own insurance companies for medical and hospital expenses, regardless of who was at fault in the accident. In some cases, you can sue the person at fault to pay additional expenses.
- Uninsured motorist coverage pays your medical expenses and economic losses (such as lost benefits and wages) when an auto accident is caused by a driver without liability insurance.
- Underinsured motorist coverage pays your medical expenses and economic losses (such as lost benefits and wages) when an auto accident is caused by someone who doesn’t have enough liability insurance.
- Collision coverage pays for damages to your vehicle (minus your deductible) caused by a collision with another vehicle or object.
- Comprehensive coverage pays for loss or damage to any vehicle insured on your policy (minus your deductible) that does not occur in an auto accident. This might include loss caused by fire, wind, hail, flood, vandalism or theft.
- Rental reimbursement coverage pays for a rental car if your vehicle is being repaired following an auto accident. There is usually a daily allowance for a rental car. (If you don’t want to be stuck with a tiny lemon of a vehicle, we recommend getting at least $40-$60 a day.)
- Umbrella policies give you an extra layer of protection – and peace of mind. We’ve reached the point where the liability options available for an auto policy are not high enough. Think about the assets you own (home, cars, toys, retirement) and assets you might have as your career grows. A bad accident can take it all away.
To make sure you have the coverage you need, find an agent you trust, and have an honest discussion about your driving habits and lifestyle. The more questions they ask, the better advice you are going to get. Minimum requirements are not usually the best option. Extra coverage is always worth the expense – and that extra coverage is usually very affordable.