7 Ways to Know if You Need More Than State Minimum Coverage
Do you have insurance? The answer should be yes, even if you’re in perfect health. But the follow-up question to that should be, Do you have enough insurance?
While many states require you to have at least some form of coverage, it may not be enough to cover everything that could happen to you or your family.
If you want more than the state minimum and don’t know where to turn or what questions to ask, consider these seven ways to know if you need more than state minimum coverage.
1) If your car is worth more than the average car
If your car is worth more than the average car, you might want to consider more than state minimum coverage for collision and comprehensive.
Collision insurance will cover damage from an accident. Comprehensive insurance covers damage from anything other than a collision, such as hail or vandalism.
Finally, don’t forget gender: Women tend to have lower premiums than men since they generally have fewer accidents; but in some cases women may find themselves paying higher premiums because they tend not to make as much money as men on average.
The price of your auto insurance can be based on factors such as where you live, how many miles you drive each year, and even your credit score.
2) If you have a history of accidents or traffic violations
If you have a history of accidents or traffic violations, then it may be time to look into more than state minimum coverage.
If you are in the process of getting a car loan and are unsure about whether or not the financing company requires higher levels of coverage, ask for clarification before signing anything.
Remember that you can always call your insurance agent and ask for guidance on what might be best for your personal situation.
In addition, many people find it helpful to visit with an independent broker who doesn’t work with any one particular carrier so they can give unbiased advice.
There is no one size fits all solution for everyone’s needs when it comes to choosing auto insurance but being proactive by checking out some different options will give you peace of mind.
3) If you live in an area with high crime rates
If you live in an area with high crime rates, you may want to consider getting more than state minimum coverage. Areas with higher crime rates mean higher premiums and not everyone can afford that.
For some people, even the cheapest plan is too expensive. For those who are low-income or at risk of being poor for the year, there is often a better deal offered through Medicaid and CHIPs.
Find out what your options are by visiting your local Department of Human Services office.
After researching your options, it’s important to know how much money you’ll have left over each month so you can determine how much money you will need to save up.
Consider cutting back on your spending to free up cash and maybe take on a part time job.
Even though it’s difficult, don’t forget about preparing for emergencies. Keeping funds set aside should give you peace of mind when disaster strikes.
4) If you have a loan or lease on your car
If you have a loan or lease on your car, the lender will require you to purchase comprehensive and collision coverage.
The lender may also require you to purchase liability coverage. If not, the minimum required by state law will be primary liability and uninsured motorist coverage.
If you are self-employed: If you are self-employed, buying additional liability and uninsured motorist insurance can protect your assets from lawsuits that could come as a result of an accident.
If you live in an area with expensive car repairs:
If you live in an area with expensive car repairs, it is wise to look into purchasing comprehensive and collision coverage because it protects your vehicle from unforeseen accidents.
If you’re expecting a large tax refund:
If you’re expecting a large tax refund this year, investing in more than just liability protection is wise.
5) If you have a family to support
If you have a family, your car is likely your most expensive possession. If you’re the sole breadwinner for your family, the thought of being unable to work because of an accident is terrifying.
If you have a spouse and kids, then it’s even more important that you consider more than state minimum coverage.
Think about how much it would cost to cover all the needs of your spouse and kids if they weren’t supported by someone else. What would happen if you were in a coma for six months?
Who would pay for daycare? Who will take care of them when they’re sick? When considering what type of coverage is right for you, don’t forget to think about your loved ones.
6) If you have assets to protect
If you have assets to protect, such as a house, car, investments, or other items that are worth more than the state minimum coverage amount (say the median value of a home in your area), then you may want to consider getting more than state minimum coverage.
Allstate does offer homeowners insurance for higher values of homes and property. The higher your policy limit is above the median value of homes in your neighborhood, the lower your premium will be.
This means that could affect how much you pay for homeowner’s insurance.
The cost of living in your city also impacts how much homeowner’s insurance costs the costlier it is to live in an area, the more expensive homeowner’s insurance rates can be because there are typically more hazards present in urban areas.
7) If you travel frequently
If you travel a lot for work, or just enjoy traveling as a hobby, then you’ll want to invest in more than the state minimum coverage when it comes time for you to get insurance.
There are a few different types of policies that can help with those extra costs and make sure that you’re covered in case anything goes wrong.
One type is travel medical insurance; this pays your medical bills up to $250,000 per trip in the event of an emergency abroad.
The other type is international medical insurance, which will cover any expenses related to your health care at home or abroad.
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