Maybe the first car you ever drove belonged to your parents? Perhaps they even paid the insurance costs. But now that you’re on your own, it is time to get your first car, independent of anyone else. This means getting your own car insurance.
If you are a first-time insurance buyer, you might not know what types of coverage you need. You want to get strong, secure coverage, but you want to be able to afford it.
1. Always Get the Required Coverage
Most states require their registered drivers to carry minimum levels of liability insurance. Texas requires:
Bodily injury liability: $30,000 per person
Bodily injury liability: $60,000 per accident
Property damage liability: $25,000 per accident
Liability coverage helps protect you if you are at-fault in an accident that harms others. This coverage can help you compensate the other affected parties. It’s easy to see how this protection might benefit you if you face a challenge from someone else. Never go without the state’s required coverage, as you can face penalties for doing so.
2. Take it a Step Further, and Get More Coverage
Remember, a state’s requirements generally are only the minimum coverage. Most drivers can more comprehensively insure themselves by buying more coverage. Some of the protection you might consider includes:
Comprehensive and Collision protection for vehicle repairs
Uninsured/Underinsured Motorist Coverage
Personal Injury Protection
Rental car coverage, roadside assistance and towing protection
and more protection. Ask your insurer what options are available on your choice of policies.
3. Determining Your Limits and Deductibles
Yes, at times, when you buy more coverage, you might pay more for your insurance. Still, you’ll often benefit from that investment in the long run. Yet, you don’t want to buy so much coverage that you can’t afford it. You usually have a lot of leeway to set up your coverage to your benefit.
Your coverage limits are the maximum amounts your insurer will pay for vehicle repairs, liability costs, etc. It’s a good idea to carry high enough limits to cover all the potential costs that might result. However, you shouldn’t carry limits that are too high to adequately reflect the value of your vehicle.
The deductible is how much money you will pay for a claim before your insurance company covers the rest. Often, by carrying a higher deductible, you can reduce your premium costs. Still, you shouldn’t carry such a high deductible that you cannot afford to pay it should a claim arise.
Make a point to work with your insurance agent to determine the coverage limits that are right for you. They can help you determine how best to structure your policy. Your financial solvency, as well as the value of the vehicle, might both play roles in determining the limits you choose. Work hard to strike the appropriate balance.