Emily was proud of herself for finding a used car that she could pay cash for. This was her first car and her first experience signing up for auto insurance. She had carefully looked at all the options for a vehicle and selected a car with great fuel economy. It was really important to her not to overspend on a vehicle, so as to not be too stretched thin on her other bills.
When it came to signing up for auto insurance, she requested a quote for the minimum required levels of coverage, declined all the extras, and chose the cheapest policy she could possibly find.
Emily is a great driver, and she’s confident that since she’s covered, everything will turn out fine in the event of an accident.
Here are some of the things we’d invite Emily and our economically-minded customers to consider regarding how to choose car insurance coverage.
The first thing that comes as a surprise to most drivers is that increasing your maximum coverage levels by a lot only increases your monthly payment a little.
Here’s an example. A Colorado driver with no accidents and an economical vehicle could pay as little as $3-5 more per month to increase Bodily Injury Liability coverage from $50,000 per accident to $300,000 per accident. Property Damage Liability works the same way. It may only cost you a dollar or two more to increase your property damage liability from $15,000 to $100,000.
But this raises the question: Does it make that much of a difference to increase the coverage levels? Isn’t the minimum level of coverage enough?
This brings up the second thing that comes as a surprise to many drivers. Accidents can cost a lot more money than you would imagine. No one ever plans to hit a new Mercedes Benz when they have an accident, because they don’t plan to have any accidents at all. No one ever plans for their accident to injure another party, resulting in an extended hospital stay. Even in what seems like a small fender bender, the other party in the accident could hire an accident lawyer to milk the situation for all it’s worth. These accident damages can include medical expenses, pain and suffering, lost wages, and even loss of affection or companionship. In circumstances like those, you would be amazed at how quickly your 25,000 to 50,000 minimum policy runs out, leaving you strapped with bills that could either bankrupt you or take you many years to pay back.
It’s worth asking the question and finding out if a tiny increase in your premium can bring you the protection and peace of mind that a higher coverage policy will bring you. Give our agents a call today.