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How Much Auto Insurance Do you Need?

A lot of people stick to one insurer one year after another without even thinking they might get a better deal. A lot of insurers offer fidelity bonuses, so sticking with one provider might pay up. However, there are companies who don't offer any kind of discount and might even raise your premiums even though you have been with them for many years in a row and had no claims.

So how would you go about determining whether you should stick with your current insurer or move to a competitor? This article will serve you as a short guide to car insurance companies.

Determine how much insurance you need

At a bare minimum, this is the insurance you have to buy:

  • Bodily injury liability: the part of the protection package that pays the medical bills for people involved in an accident where you were at fault. Most states require a minimum of $50,000 per passenger, with a cap at $150,000. A good option would be a $100,000/$300,000 ratio.
  • Property damage: this covers the expenses for any material damage you have caused, like other vehicles or someone else's property. Most states impose a minimum between $10,000 and $30,000, but we would recommend something in the range of $100,000.

You may also want to get these packages:

  • Personal Injury Protection: it reimburses you for lost wages while you are in hospital or unable to work after an accident. A PIP policy is mandatory in some states.
  • Collision and comprehensive coverage: Collision covers the repair of your car after an accident regardless of who was at fault, while Comprehensive covers what Collision includes and also reimburses you if your car is stolen or vandalized.
  • Roadside assistance is good to have if your car breaks down in the middle of the road. Some auto club memberships offer such services though, and so might your car manufacturer if your auto is still in warranty, so make sure you don't have redundant packages.
  • Car rental reimbursement pays back for some rent-a-car fees in the event you are unable to use your own car for a period of time.

Find out who has the best rates and top services

Get a list of good car insurance companies and find out how much they charge. Most companies allow you to get the quotes online, which is faster, more straightforward and lets you play with what-if scenarios. If not, you will have to call them.

Price shouldn't be the only factor in your decision, and this is one of the reasons why none of the lists and charts of the top car insurers are ordered by their pricing models. Once you have narrowed your search down to a handful of companies, do a bit of research and see how pleased others are with their services. The availability of the customer support department is of a crucial importance – no matter how cheap a policy is, if there is no one there to pick up the phone at 3am when your car broke down then it's useless.

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