How much insurance coverage do I need?

When deciding how much insurance coverage to get, you need to make sure that you at least have the minimum required in your state. If you're caught driving without insurance coverage, you could face fines of around $300 and possible jail time.

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Chris Tepedino is a feature writer that has written extensively about auto insurance for numerous websites. He has a college degree in communication from the University of Tennessee and has experience reporting, researching investigative pieces, and crafting detailed, data-driven features. His works have been featured on CB Blog Nation, Flow Words, Healing Law, WIBW Kansas, and Cinncinati.com. ...

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Rachael Brennan has been working in the insurance industry since 2006 when she began working as a licensed insurance representative for 21st Century Insurance, during which time she earned her Property and Casualty license in all 50 states. After several years she expanded her insurance expertise, earning her license in Health and AD&D insurance as well. She has worked for small health in...

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Reviewed by Rachael Brennan
Licensed Insurance Agent Rachael Brennan

UPDATED: Feb 15, 2022

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It’s all about you. We want to help you make the right coverage choices.

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Editorial Guidelines: We are a free online resource for anyone interested in learning more about auto insurance. Our goal is to be an objective, third-party resource for everything auto insurance related. We update our site regularly, and all content is reviewed by auto insurance experts.

Can't-Miss Facts

  • How much coverage you need will depend on your vehicle
  • You shouldn’t get more car insurance coverage than you can reasonably afford
  • If your rates are too high everywhere, there may be ways to lower the risk you pose

How much auto insurance coverage do I need? The answer will likely depend on your vehicle and what it will need over its life. There are multiple types of car insurances with the ability to customize them, so it becomes more about what you can reasonably afford. If rates are too high, there may be ways to get lower automobile insurance rates.

Now that you know how much insurance you need, enter your ZIP code into our free quote tool to see what you could pay for insurance today.

How much insurance do I need?

How much insurance coverage do I need? Deciding on the amount of coverage is one of the most essential parts of enrolling in auto insurance. If you purchase too much coverage, you’ll likely have difficulty affording it. On the other hand, if you don’t get enough auto insurance coverage, you’ll be faced with the cost of repairs.

Finding a comfortable place in between can ensure that you get enough coverage at a price that you can easily afford. If you’re having trouble finding affordable rates anywhere, consider lowering the risk you pose to your auto insurance policy.

You should be aware that there is a minimum amount of car insurance required in most states. Usually, this is a certain amount of liability insurance that covers other people and property you may damage with your car.

What is the minimum required auto insurance?

Each state determines its minimum liability coverage, meaning that you’ll need a different amount of liability depending on where you live in the country. The states that don’t require a minimum liability coverage will have the driver prove that they can meet the financial cost of an accident.

What should I consider when getting auto insurance?

There are multiple considerations when you sign up for an auto insurance policy. First, you’ll need a policy with the coverage you need at a price you can afford. If your policy doesn’t give you everything you need, you’ll likely have some problems with it down the road.

Some of the questions you should ask yourself when looking for an auto insurance policy include:

  • How much does insurance cost?
  • What coverage options are available to you?
  • What is the value of your car?

If your car is more valuable or has a higher chance of being vandalized, you’ll likely pay more for that insurance coverage. On the other hand, if the opposite is true and your car has little value, you won’t see much benefit from collision and comprehensive auto insurance.

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Why do I need auto insurance?

Auto insurance is a great tool that can keep you from being held financially responsible when your car is in an accident. For instance, with liability insurance coverage, you won’t have to pay for the medical bills or property damage that occurs because of your vehicle. Of course, you may still face legal liability in those instances, but you’ll be financially secure.

Some of the things that auto insurance can protect against are:

  • Fire, flooding, debris
  • Car collisions that happen while driving
  • Theft and vandalism
  • Totaled car protection

With the availability of policies and riders on the market, you should have no problem getting auto insurance that fits you and your vehicle. However, it would help if you kept in mind that the more insurance coverage you have, the more it will cost you each period.

What happens if I don’t have auto insurance?

According to the Insurance Research Council, one in eight drivers doesn’t have any form of auto insurance. This isn’t one in eight Americans, but registered drivers who are out on the road. If you don’t have insurance and get pulled over, you’ll face fines and even jail time, if it’s a repeated offense.

Some of the consequences of driving without auto insurance include:

  • Fines around $300 for first offenses
  • Jail time for repeated violations or accident
  • Suspended car registration until you get insurance
  • Difficulty obtaining insurance after traffic incident

Auto insurance is a required tool in nearly every state. Even in the states that don’t need auto insurance, you’ll have to prove you have the financial means to pay for an accident yourself. Not having insurance can leave you financially and legally responsible for someone else if you injure them in your vehicle.

What are the different types of auto insurance?

A few main types of auto insurance will help you get your car to a safer place. If you aren’t sure where to start, you should consider liability since it is required in most states. Once you have that in place, you’ll be able to view more optional coverage options.

Some of the most popular auto insurance policies include:

  • Liability. This is the minimum required auto insurance, as it covers other people and property that you damage with your vehicle.
  • Comprehensive. This coverage protects against severe weather damage, as well as theft and vandalism.
  • Collision. This protects your vehicle when you collide with something else while on the road or when someone collides with you.

This isn’t a limit to the coverage you can find, but it is the most popular. This list, also known as full coverage for all, will protect your vehicle in various situations.

How can I further customize my auto insurance?

If you don’t feel that your insurance coverage goes far enough, you can always add riders at an additional cost. In addition, riders are an excellent tool for those who want specific things covered.

Some of the most popular auto insurance riders include:

  • Accident forgiveness. One accident won’t affect your auto insurance rates.
  • New car replacement. If your car gets totaled, your insurance company will replace it with the latest model.
  • Rideshare. If you use your vehicle to transport passengers, this rider will cover the gap between personal insurance and what the app-based service offers.

Other riders protect the items inside your vehicle and custom parts coverage. Discuss your rider options with an insurance agent if you need something specific covered.

How can I get lower auto insurance rates?

Auto insurance companies determine a person’s rates based on underwriting. During underwriting, an insurance agent will examine various areas in a driver’s life to determine the risk they pose. According to the insurer, if that driver has a higher potential to get into an accident, the more the driver will pay each period.

If you want to lower your auto insurance rates, you need to understand how you can reduce the risk that you pose. You can do this by understanding what areas the insurance company will look at.

Some examples of the areas that the insurer will examine during underwriting are:

  • Past driving record
  • Credit history
  • Criminal record
  • Demographics, like age

Inexperienced drivers and those with negative flags on their records will pay the most for auto insurance. If you need to lower your auto insurance rates, consider paying your bills on time and putting some distance between yourself and past issues.

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Deciding on Coverage: The Bottom Line

If you don’t yet have insurance, you should know that getting your first policy isn’t as hard as it may seem. Once you decide on how much coverage you want and what you can afford, you’ll be ready to start your policy. There are multiple ways to customize your insurance, but it will cost more to do so.

Now that you know how much insurance coverage to have, enter your ZIP code into our free quote tool to see what you could pay today.

Free Auto Insurance Comparison

Enter your ZIP code below to compare auto insurance rates.

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