Car insurance requirements vary by state. If you plan on driving a vehicle in the U.S., you will be expected to carry a minimum amount of insurance. This typically includes certain limits of liability insurance. However, minimum liability is not usually enough to cover you in case of an accident.
What Does Liability Car Insurance Cover?
Liability insurance only covers injuries and damages you may cause another person in an accident. For example, if you cause an accident that results in injuries, liability insurance will step in to pay for the victim’s medical bills as well as protect you against a lawsuit.
Liability insurance does not cover damages to your vehicle or injuries you and your passengers may suffer, however. If you get into an accident with only minimum liability insurance, you may be expected to pay for your own medical bills and damages to your vehicle all out of pocket.
You also run the risk of not having enough liability insurance. For example, the auto insurance requirements in Florida are:
- $10,000 in bodily injury liability per person
- $20,000 in bodily injury liability per accident
- $10,000 in property damage liability
If an accident exceeds these limits, you may be faced with paying additional expenses out of pocket. It is important to speak with your insurance agent about protecting your vehicle as much as possible. This is why full coverage is typically recommended.
Is Full Coverage Car Insurance Required?
While full coverage car insurance is not required by state or federal law, it may be required on vehicles that still have a loan. If you buy a new car, the dealership may require you to carry full coverage auto insurance for a certain amount of time until you’ve paid off the car.
Even without the requirement, full coverage is recommended. Full coverage auto insurance simply refers to the highest amount of insurance you can place on a single-vehicle. These policies must all include at least the minimum liability requirements, but also include coverage such as:
- Comprehensive: Comprehensive coverage provides compensation for damages to your vehicle caused by fire, wind, hail, falling objects, theft, vandalism and other incidents not involving a collision.
- Collision: Collision coverage helps cover damages to your vehicle caused by a collision with another vehicle or object.
- Medical Payments: Medical payments coverage, available as personal injury protection in some states, covers the medical bills you and your passengers may face after an accident.
- Uninsured/Underinsured Motorist: This insurance covers damages that may occur in an accident involving a driver who is not carrying insurance.
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