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This is an easy mistake to make and I have seen it again and again. A potential client comes in and says, “Give the cheapest thing you got for auto insurance”. I flat out will tell them, “No”.
The cheapest thing I got, could end up being the most expensive thing you buy. State minimum insurance limits are inadequate for you. Here in Idaho- they are 25/50/15. What this means is $25,000 per person, $50,000 per accident and $15,000 for property damage.
If you are in an at fault accident and you injure someone or damage any property, that is all the insurance company is going to pay for the damage you cause. $25,000 per person and $50,000 per accident to pay for medical expenses if there are injuries. $15,000 to fix their car. So you better have good aim, and only plan on hitting used cars.
If you don’t have enough coverage, you are responsible for whatever is left over. If you haven’t noticed medical expenses are astronomical these days. If you don’t have enough coverage at the time of an accident, the bills start showing up in your mailbox. Worst case scenario, the state can garnish your wages to pay off a debt like this.
Let’s say you are driving along, and your phone alerts you to any of the myriad of things your phone alerts you for and you fall for it and look. When you are traveling 50 MPH, that is 73 feet per second. If you look down for 2.5 seconds you travel about 180 feet and if the driver in front of you slams their brakes on to stop, you will hit them.
If you hit a car going 50 MPH there is a good chance you are going to send someone to the hospital and total their car. This happens every day. The expenses you would be liable for in a situation like that…
Ambulance, emergency room visit, possible surgery, overnight(s) stay in the hospital, physical therapy, loss of income, and legal fees if there are attorneys involved. That can add up real quick. You can exhaust $25,000 in one day if there is a hospital visit involved.
The thing you don’t know, is that the liability portion of your insurance is VERY INEXPENSIVE to raise your limits. You can buy 50/100, 100/300, 250/500 or 500/500. To go from 25/50 to 250/500 is usually less than $10 per car per month here in Idaho.
If you don’t thing that is enough liability, you can look into getting an umbrella policy. Read “You don’t have to be a millionaire to be sued like on” here. I would encourage you to call your agent and check your limits. You can ask them how much it would cost to raise your limits and they can do it right there on the phone with you. Insurance is there for you to protect your assets, but you have to have the right coverage in place at the time of the incident. Make sure you are covered properly.
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