Minimum Auto Insurance Requirements

By Compuquotes Team on March 27th, 2008
Auto Insurance

Throughout the United States and Canada, there is a minimum auto insurance requirement. These requirements vary from state to state and province to province, but they all have a minimum that is required by law for each driver to have on their vehicle. Failure to have insurance can result in the loss of your driver's license and/or registration, can give you a hefty fine and even jail time.

There are a few questions you likely have about insurance, and questions that you should have answers to before driving your vehicle. You need to find out the minimum insurance required for your state or province and also what that minimum covers. Chances are that the minimum insurance that you are required to have by law doesn't cover very much and won't cover you in the event of an incident. You should purchase as much insurance as much as you can afford, and your insurance agent can help you figure that out. Before you hit the insurance agent's office, there's some basic information you should have first.

You need to understand what other coverage is available, how much it will cost, if you can afford it and what you are protecting.

Most often, the minimum required is called "PL and PD', personal liability and property damage. In some states, you are also required to have under-insured / un-insured coverage as well, in case you are involved in a collision where the other person doesn't have auto insurance. Once you know what your state minimum requirement is, you have to find out what it covers. In some cases, you are only required to have, for example, $20,000 property damage, which doesn't cover the cost of some new vehicles. the personal liability minimums in some states aren't enough to cover any real injuries that could occur in a collision.

Bodily injury liability, or personal liability, covers bodily injuries and deaths for which you are at fault. Claims to your personal liability insurance could be for medical bills, loss of income and pain or suffering.

Comprehensive coverage, or property damage, covers your vehicle, and occasionally other vehicles for damages that happened as a result of an incident other than a collision. Usually, fire, theft, damage by acts of God or impacts with animals are covered under comprehensive insurance. There will be a deductible to pay for the claim to be processed. This deductible is at a level that you choose when you take out the policy.

Collision coverage is insurance for your vehicle when it is involved in a collision with another vehicle or an object. There is a deductible for this insurance as well, which is chosen by you when you take out the policy.

Under-insured / un-insured insurance coverage covers you and your passengers, as well as your vehicle if the other driver is found to be at fault and either has no insurance or inadequate insurance to cover your losses. This insurance is required in many states.

It's always a good idea to get a few quotes for insurance before you decide on a policy and company to go with. Research out your options and ensure that you and your vehicle are adequately covered.

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