One way of looking at how much car insurance coverage you should buy is to look at possible losses you may suffer and how you would financially be affected by them. We cannot just forget about possibilities with a positive thinking that nothing ever will happen. Hopefully, nothing ever will happen but nobody buys insurance hoping that something will happen. The point in buying insurance is to be protected against unknown future mishaps and misfortunes.
Sensibly you would want to pass the risks you would struggle to handle on your own to the insurer. And you may choose not to insure for smaller damages as you can pay them out of the pocket. Maybe you would prefer to pay small damages out of the pocket anyway to keep the claim numbers down. Depending on how you feel about risk you can choose how much to take on and what to insure.
Possible Liabilities Claims
Since it is legally required to buy liabilities auto insurance coverage in every state to be able to drive cars legally we should start from here. Should you just buy the minimum state required coverage and be done with it or buy sizeable coverage and be safer? It is probably not a nice way of thinking that you should think about your assets when there is a chance that some people may not be paid for their injuries and damages.
In fact, buying sufficient liabilities coverage protects your assets better. Because your liabilities cover has been exhausted people are not going to stop there. They will come after you and your assets will be on the line for the payments. If they are awarded damages you will have to sell your home and pay them if you have no other means. So, you should increase the liabilities cover limits to a comfortable level if you can afford it.
Protecting Your Car
Motorists invest as much as they can for a new car. If they had more money they would probably buy a better one. If you do not have sufficient spare money on the side you would financially struggle to deal with large repairs let alone a total loss of your automobile. Therefore, it would be essential to insure them comprehensively unless you really are driving a clunker.
There are always a few reasonably priced fully comprehensive package policies available on the market. The options are higher for good drivers and would go down as your driving history gets worse. These policies would include Liabilities (generally generous limits), Collision, Comprehensive and Uninsured Driver Coverage. Package policies are great in providing coverage for most of the possible large losses and offer affordable premiums.
If you like to pass on most of the risks involved with your car you can buy more comprehensive policies. You can add legal defence and punitive damages to your liabilities coverage or buy additional umbrella liabilities coverage to include any other liabilities. Good policies do include defence coverage these days so you should check it first.
You can buy Rental Reimbursement Coverage if you like. Depending on your health insurance provisions you may decide to buy Personal Injury Protection Coverage or leave it. Think about what else you may need and there is a high chance there will be insurance policy to cover it. But you will have to think your budget as well.