Money

The Grown Ups Guide to Car Insurance

Don't be one of the 15%

Here’s something to think about next time you’re driving down a crowded highway at 5:00 in the evening after a long day’s work, 1 in 7 of the cars you are surrounded with don’t have insurance. Not under-insured, but no insurance. So if you are in the middle lane and surrounded, swivel your head around because one of those people could be responsible for your next claim and they may not have the proper coverage to meet your financial needs. Hey, wait a minute, do I have the proper coverage for my needs? What are my needs, crap, I think it’s time for a grown up look at buying car insurance!

First, the basics, what is insurance? It’s a transfer of risk. Grown ups have to take risks every day and one of those risks is driving. We take massive chunks of metal, throw our fragile little bodies inside and move at insanely high speeds. What could happen?! Car Insurance is transferring our financial obligations if we cause damage either to our own car or someone else’s car as we are driving. So how do we do this?

Most states have laws in place that require we have a certain minimum of coverage. This is basically our protection against a mutually assured destruction of a bunch of uninsured motorists hitting each other and driving away without consequence. The minimum coverage centers around these three coverages: Bodily injury liability for one person in an accident, Bodily injury liability for all people injured in an accident and Property damage liability for one accident. There are many other things we can cover, which we’ll get to in a moment, but this is a good starting point


What are my state minimums?

The good folks at The Balance have provided a chart of your state minimums. Take a look at your state and make sure you are good!

Full List of Minimum Car Insurance Required By Law in Your State and Exceptions Alabama

  • $25,000 bodily injury liability per person
  • $50,000 bodily injury liability per accident
  • $25,000 property damage liability per accident

Alaska

$50,000 bodily injury liability per person
$100,000 bodily injury liability per accident
$25,000 property damage liability per accident

Arizona

Arizona has a special condition around legal requirements to drive your car. All drivers must show financial responsibility. You do not have to have insurance, however, if you choose to not purchase insurance you will have to be ready to put up a $40,000 bond to prove you can pay for damages resulting from an accident. Naturally, for most people, buying the minimum car insurance makes a lot more financial sense. Here are the Arizona minimum requirements if you choose to purchase insurance instead of put up a bond:

$25,000 bodily injury liability per person
$50,000 bodily injury liability per accident
$25,000 property damage liability per accident

Arkansas

$15,000 bodily injury liability per person
$30,000 bodily injury liability per accident
$10,000 property damage liability per accident

California

$15,000 bodily injury liability per person
$30,000 bodily injury liability per accident
$5,000 property damage liability per accident

Colorado

$25,000 bodily injury liability per person
$50,000 bodily injury liability per accident
$15,000 property damage liability per accident

Connecticut

$20,000 bodily injury liability per person
$40,000 bodily injury liability per accident
$10,000 property damage liability per accident
$20,000 uninsured/underinsured motorist coverage per person
$40,000 uninsured/underinsured motorist coverage per accident

Delaware

$15,000 bodily injury liability per person
$30,000 bodily injury liability per accident
$10,000 property damage liability per accident

Florida

$10,000 property damage liability per accident
$10,000 personal injury protection
Georgia

$25,000 bodily injury liability per person
$50,000 bodily injury liability per accident
$25,000 property damage liability per accident

Hawaii

$20,000 bodily injury liability per person
$40,000 bodily injury liability per accident
$10,000 property damage liability per accident
$10,000 personal injury protection

Idaho

$25,000 bodily injury liability per person
$50,000 bodily injury liability per accident
$15,000 property damage liability per accident

Illinois

$25,000 bodily injury liability per person
$50,000 bodily injury liability per accident
$20,000 property damage liability per accident
$25,000 uninsured motorist coverage per person
$50,000 uninsured motorist coverage per accident

Indiana

$25,000 bodily injury liability per person
$50,000 bodily injury liability per accident
$10,000 property damage liability per accident

Iowa

$20,000 bodily injury liability per person
$40,000 bodily injury liability per accident
$15,000 property damage liability per accident

Kansas

$25,000 bodily injury liability per person
$50,000 bodily injury liability per accident
$10,000 property damage liability per accident
$25,000 uninsured/underinsured motorist coverage per person
$50,000 uninsured/underinsured motorist coverage per accident

Personal injury protection ($4,500 in medical expenses, up to $900 per month for disability or loss of income, $25 per day for in-home services,$4,500 for rehabilitation, $2,000 for funeral burial or cremation costs)

Kentucky

$25,000 bodily injury liability per person
$50,000 bodily injury liability per accident
$10,000 property damage liability per accident
$10,000 personal injury protection

Louisiana

$15,000 bodily injury liability per person
$30,000 bodily injury liability per accident
$25,000 property damage liability per accident

Maine

$50,000 bodily injury liability per person
$100,000 bodily injury liability per accident
$25,000 property damage liability per accident
$50,000 uninsured motorist coverage per person
$100,000 uninsured motorist coverage per accident
$2,000 medical payments coverage

Maryland

$30,000 bodily injury liability per person
$60,000 bodily injury liability per accident
$15,000 property damage liability per accident

Massachusetts

$20,000 bodily injury liability per person
$40,000 bodily injury liability per accident
$5,000 property damage liability per accident
$20,000 uninsured motorist coverage per person
$40,000 uninsured motorist coverage per accident
$8,000 personal injury protection

Michigan

$20,000 bodily injury liability per person
$40,000 bodily injury liability per accident
$10,000 property damage liability per accident

Personal injury protection (unlimited) Michigan offers no-fault insurance with mandatory coverages
$1 million property protection (PPI). PPI pays up to $1 million for damage your vehicle does in Michigan to other people’s property, such as buildings and fences.

Minnesota

$30,000 bodily injury liability per person
$60,000 bodily injury liability per accident
$10,000 property damage liability per accident
$25,000 uninsured/underinsured motorist coverage per person
$50,000 uninsured/underinsured motorist coverage per accident
$40,000 personal injury protection

Mississippi

$25,000 bodily injury liability per person
$50,000 bodily injury liability per accident
$25,000 property damage liability per accident

Missouri

$25,000 bodily injury liability per person
$50,000 bodily injury liability per accident
$10,000 property damage liability per accident
$25,000 uninsured motorist coverage per person
$50,000 uninsured motorist coverage per accident

Montana

$25,000 bodily injury liability per person
$50,000 bodily injury liability per accident
$10,000 property damage liability per accident

Nebraska

$25,000 bodily injury liability per person
$50,000 bodily injury liability per accident
$25,000 property damage liability per accident
$25,000 uninsured motorist coverage per person
$50,000 uninsured motorist coverage per accident

Nevada

$15,000 bodily injury liability per person
$30,000 bodily injury liability per accident
$10,000 property damage liability per accident

New HampshireCar insurance is not mandatory in New Hampshire. There is no minimum car insurance requirement for the State of New Hampshire, however, state law does require you to pay for any bodily injury or property damage arising from your operation of a vehicle that you own.

So, although there is no law forcing you to purchase auto insurance in New Hampshire, there is a law which will hold you responsible for paying for damages. You should purchase at least the minimum car insurance to protect yourself and your family.

These are the minimum car insurance limits available when you do decide to purchase insurance:

$25,000 bodily injury liability per person
$50,000 bodily injury liability per accident
$25,000 property damage liability per accident
$25,000 uninsured/underinsured motorist coverage per person
$50,000 uninsured/underinsured motorist coverage per accident
$25,000 uninsured/underinsured motorist property damage coverage
$1,000 medical payments coverage

New Jersey

$15,000 bodily injury liability per person
$30,000 bodily injury liability per accident
$5,000 property damage liability per accident
$15,000 personal injury protection
New Mexico

$25,000 bodily injury liability per person
$50,000 bodily injury liability per accident
$10,000 property damage liability per accident

New York

$25,000 bodily injury liability per person
$50,000 bodily injury liability per accident
$50,000 liability for death per person
$100,000 liability for death per accident
$10,000 property damage liability per accident
$50,000 personal injury protection
$25,000 uninsured motorist coverage per person
$50,000 uninsured motorist coverage per accident

North Carolina

$30,000 bodily injury liability per person
$60,000 bodily injury liability per accident
$25,000 property damage liability per accident
$30,000 uninsured motorist coverage per person
$60,000 uninsured motorist coverage per accident
$25,000 uninsured motorist property damage coverage per accident

North Dakota

$25,000 bodily injury liability per person
$50,000 bodily injury liability per accident
$25,000 property damage liability per accident
$25,000 uninsured/underinsured motorist coverage per person
$50,000 uninsured/underinsured motorist coverage per accident
$30,000 personal injury protection

Ohio

$25,000 bodily injury liability per person
$50,000 bodily injury liability per accident
$25,000 property damage liability per accident
Oklahoma

$25,000 bodily injury liability per person
$50,000 bodily injury liability per accident
$25,000 property damage liability per accident

Oregon

$25,000 bodily injury liability per person
$50,000 bodily injury liability per accident
$20,000 property damage liability per accident
$25,000 uninsured motorist coverage per person
$50,000 uninsured motorist coverage per accident
$15,000 personal injury protection

Pennsylvania

$15,000 bodily injury liability per person
$30,000 bodily injury liability per accident
$5,000 property damage liability per accident
$5,000 medical benefits

Rhode Island

$25,000 bodily injury liability per person
$50,000 bodily injury liability per accident
$25,000 property damage liability per accident

South Carolina

$25,000 bodily injury liability per person
$50,000 bodily injury liability per accident
$25,000 property damage liability per accident
$25,000 uninsured motorist coverage per person
$50,000 uninsured motorist coverage per accident
$25,000 uninsured motorist property damage coverage

South Dakota

$25,000 bodily injury liability per person
$50,000 bodily injury liability per accident
$25,000 property damage liability per accident
$25,000 uninsured/underinsured motorist coverage per person
$50,000 uninsured/underinsured motorist coverage per accident

Tennessee

$25,000 bodily injury liability per person
$50,000 bodily injury liability per accident
$15,000 property damage liability per accident

Texas

$30,000 bodily injury liability per person
$60,000 bodily injury liability per accident
$25,000 property damage liability per accident

Utah

$25,000 bodily injury liability per person
$65,000 bodily injury liability per accident
$15,000 property damage liability per accident
$3,000 personal injury protection

VirginiaVirgina has special conditions around car insurance. You do not necessarily have to buy car insurance, according to the DMV, Virginia law requires that all drivers have a way to pay for injuries or property damage resulting from a car accident. Minimum car insurance is one way to meet this requirement. These are the Virginia minimums:

$25,000 bodily injury liability per person
$50,000 bodily injury liability per accident
$20,000 property damage liability per accident

Vermont

$25,000 bodily injury liability per person
$50,000 bodily injury liability per accident
$10,000 property damage liability per accident
$50,000 uninsured/underinsured motorist coverage per person
$100,000 uninsured/underinsured motorist coverage per accident
$10,000 uninsured/underinsured motorist property damage coverage per accident

Washington

$25,000 bodily injury liability per person
$50,000 bodily injury liability per accident
$10,000 property damage liability per accident

Washington D.C.

$25,000 bodily injury liability per person
$50,000 bodily injury liability per accident
$10,000 property damage liability per accident
$25,000 uninsured/underinsured motorist coverage per person
$50,000 uninsured/underinsured motorist coverage per accident
$5,000 uninsured/underinsured motorist property damage coverage per accident

West Virginia

$25,000 bodily injury liability per person
$50,000 bodily injury liability per accident
$25,000 property damage liability per accident
$25,000 uninsured motorist coverage per person
$50,000 uninsured motorist coverage per accident
$25,000 uninsured motorist property damage coverage

Wisconsin

$25,000 bodily injury liability per person
$50,000 bodily injury liability per accident
$10,000 property damage liability per accident
$25,000 uninsured motorist coverage per person
$50,000 uninsured motorist coverage per accident

Wyoming

$25,000 bodily injury liability per person
$50,000 bodily injury liability per accident
$20,000 property damage liability per accident

First thing to remember here, these are minimums. I know that C’s get degrees people, but that doesn’t mean you should bragging about your GPA! These limits should be called caps, because they are caps on what the insurance company will pay per incident. If you’re checking a tweet one day as your driving your death machine down the 405 in Los Angeles and slam into the back of a new Mercedes G wagon, your minimums aren’t going to touch what your true costs could amount to. If you hurt someone and are responsible for their hospital bills (this is real) and your insurance company will only pay 20 grand, start praying to your God of choice that they don’t spend more than one night at UCLA medical.

There are a competing schools of thought here. Experts in insurance will typically recommend that you purchase 100/300 limits of bodily injury liability. What does that mean in English? It means the insurance company will pay $100,000 for one person in an accident and $300,000 for all people injured in one accident. Others would argue, if your personal assets don’t amount to much, there’s not much for another driver to get if they were to sue you. The minimum requirements might actually suit you and will save you some much-needed cash because your premiums would be lower and your risk lower as well. That is until you need it to pay if you get hurt.

Besides the liability to bodily injury, what about your sweet ride? You also need collision and comprehensive coverage. The purpose of collision is to cover damage to the policyholder’s car resulting from running into anything, literally, anything. Comprehensive coverage is to take care of your car in the case of theft, fire, falling objects, explosions or other unexpected problems like a full our Big Lebowski car theft. If your ride is a Lebowski achiever that is one ignition turn away from death, you probably don’t need this. However if you are riding in something sweet, you should make sure you have this coverage, in fact if you are leasing or taking financing, the financier may require it on the lease or loan.

Now for the bells and whistles. If you don’t have AAA or your loan or lease don’t provide, you may want to look at roadside assistance. This comes in handy when you realize you never took dad up on his offer to show you how to change a tire. You should also think about uninsured motorist coverage. Again, 1/7 people nationally and if you live in Oklahoma, your just screwed, ¼ people there are uninsured. This coverage is specifically for when you get hit by one of those irresponsible A-Holes and they take off leaving you with a destroyed car and an anger management concern. Other items to look at would be car rental if you need a car if you have to take yours to the shop and GAP insurance because your car loses value everyday but you are still responsible to pay what is owed!

Now begs the question, how am I going to buy my insurance? Personally, I’m a price compare guy. There are some amazing services from Policy Genius and Nerd Wallet that will allow you to shop companies against one another. You can click their images below to be directed. This is something that isn’t as large yet in the US, but elsewhere everyone uses comparison sites to get their insurance. If you aren’t comfortable with the online experience, I recommend using an independent agent that can shop for you. They can sometimes charge a broker fee, but if they save you more than you otherwise would’ve spent, I think it’s a fee well worth it. You can email me at jessehendon@gmail.com for a few of my recommendations. Finally, you can go to the mom and pop captive agent companies like State Farm, Progressive or All State. They are companies you know will pay if something happens, but you may not get the best deal out there. Again, alwasy feel free as always to email me at jessehendon@gmail.com with any questions you may have! Now, go be safe and remember, do the grown up thing and insure your car because 1/7 of us aren’t and you don’t want to be that guy!

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