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Average Car Insurance Coverage

The average auto insurance coverage varies by state, and is based largely on what the state determines a driver’s legal responsibility. Most drivers choose comprehensive over liability, not only because of the protection it provides but because doing so is a requirement for financing. What limits they select, and the deductibles they agree to pay can vary as well, but common sense tends to dictate these as well.  The average price of insurance will vary depending on a number of different factors, one of which is location.  The place that you live will determine what you pay; higher traffic areas are often associated with higher prices.

What is Average Car Insurance Coverage?

To a degree, state law calls upon average costs for replacement, repair and medical expenses deriving from an auto accident. Quoted in the thousands, car insurance liability coverage takes care of bodily injury and property damage. A quote of 25/50/10 means your policy will pay $25,000 per injured person, $50,000 for the entire care of everyone in the other car, and $10,000 to cover the damage to the other person’s property.

In an accident, you may not want to risk being sued by the other person should your insurance not cover all of their expenses. It’s fairly simple and inexpensive to expand coverage to 50/100/50, but beyond that can get iffy. Depending on your homeowner’s insurance, this may not be necessary. Some policies cover things like liability from accidents. Some don’t, but it’s worth checking out to see whether yours offers the coverage that you need.

Beyond liability, of course, is collision and comprehensive. Collision coverage pays for your own damages sustained during an accident, while comprehensive pays from damages acquired from any source, such as a neighborhood child scratching your car with a rock. You can also add riders to your insurance, uninsured/underinsured motorist or extra medical coverage like PIP or Med Pay insurance.

Average Car Insurance Cost & Rates

Again, it is important to know that average rates tend to be in the thousands on an annual basis (depending on your state).  Some questions to keep in mind regarding your insurer should include:  How much will they cover per item? How much will they pay out per incident? It depends. How much could someone sue you for? Do you own and make enough money so that someone would bother suing if your insurance didn’t pay for all of their bills? Could you lose your business or home? The answers to these questions determine what kind of coverage you should carry on your vehicle. Average limits for a 30-something male making $40,000 a year will be much different than a 50-year old CEO with two kids in college.

The cost of any insurance policy will differ depending on what type of vehicle you drive and the company that you decide to go with. If you buy comprehensive and collision, then you will be expected to pay more than average since you are receiving more coverage. Take the time to figure out what you can afford before you buy.

Would you be better off with ABOVE average car insurance?

Figuring your financial worth is easy and will help you figure out what you have to lose in a lawsuit. Add up your assets – the value of your home and belongings, savings, investments and insurance policies – and subtract your debts – mortgage balance, credit card bills, and past due bills. This is your financial worth, and what you could possibly lose if you were sued.  Whatever liability limits you choose in insurance should be close to, or ideally exceed your financial worth. That protects you, your family and your assets if there is an accident. When buying insurance, always be smart and get a policy that makes you feel satisfied as a driver.

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