Why Do You Need Car Insurance? Reasons Why You Should Get Coverage

You primarily need car insurance because it’s required by law in most states. Drivers must purchase a minimum amount of car insurance, which varies by state and generally includes liability insurance and underinsured or uninsured motorist coverage.

In many cases, you may want to increase your coverage limit above and beyond what is required by law since doing so can help to ensure that you’re protected financially in the event of an accident. Not having enough coverage could mean you’re stuck paying a huge amount out of pocket for car repairs or medical bills after an accident.

• Why Do You Need Car Insurance?
• How Much Car Insurance Should You Get?
• Frequently Asked Questions

Car insurance is mandatory in almost all states. Carrying car insurance protects you as a driver, as well as others on the road. Liability insurance covers damage you cause to other vehicles or individuals in an accident, while other types of personal car insurance, like collision and comprehensive coverage, cover damage to your own vehicle.

Requiring car insurance for all drivers helps ensure that an accident's results aren’t financially devastating, whether or not you’re at fault.

When deciding how much auto insurance coverage you need, you may consider sticking to the 100/300/100 rule of thumb. This rule suggests you purchase $100,000 in bodily injury liability coverage per person, $300,000 in bodily injury liability coverage per accident and $100,000 in property damage liability coverage per accident.

In addition to liability coverage, PIP or UM/UIM coverage may also be required. Even if it’s not mandatory, these types of coverage can still be a good idea since they help to cover medical bills and repairs if you’re in an accident. You may also want to add comprehensive and collision insurance, which covers damage to your car.

Listed below is the cost of full coverage per company:

In many cases, opting for additional auto insurance coverage above and beyond liability insurance is a good idea. In many cases, these additional coverage types aren’t that expensive, adding only a few dollars to your monthly insurance bill.

They can provide extra peace of mind and save you a lot of money if you end up in an accident. Not all of these add-ons are available from all insurers, so you should ask your insurance company which ones you can add to your policy.

With many different coverage types, car insurance can sometimes be confusing. We cover some common questions surrounding car insurance to help you understand what you need.