Deciding on Appropriate Coverage
When determining which coverage and limits of Auto
Insurance you need, consider the following points:
How Much Insurance Do You Need?
Decide which coverages
you need. Here
are some points to consider:
- Your financial responsibility
Washington, Oregon and Idaho all require drivers to carry
Bodily Injury Liability limits of at least $25,000 per person/$50,000
per accident. If your net worth exceeds $300,000, consider buying
additional liability insurance. Most insurers offer limits up
to $250,000 per person/$500,000 per incident for an additional
premium. If you feel you need higher limits, a Personal Umbrella
Policy will supplement your underlying coverage with an additional
$1 million or more.
Typically, these policies cost between $200 and $300 per year
for a million dollars in coverage. Ask your agent or insurance
company representative for details.
Every driver has a responsibility not only for driving in a
safe manner, but also for injuries or damages he or she might
cause to other people and their property. Most states
have laws which make it important -- or even necessary -- to
have insurance. They require that you file a report if you have
an accident involving bodily injury or substantial
property damage. You then may be asked to present proof
that you can pay damages up to amounts required by law.
- Your car
If you drive an older model, its value might seem low compared
to the cost of Collision Coverage. In this case,
you may decide not to buy collision insurance.
- Deductibles & your personal finances
Collision and Comprehensive coverage usually come with deductibles.
this means you agree to pay a specified. Options normally range
from $100 to $1,000 per incident -- for damage to your car that
occurs in any accident. Your insurance company agrees to pay
the remainder of the cost of repairs, up to the vehicle's actual
value at the time of the loss.
By eliminating the cost of processing small claims, the company
can provide the coverage at a lower price. You must decide whether
you prefer a small deductible at a higher price, or a higher
deductible at a lower price.
- Gap Insurance
Often referred to as debt and financing coverage, Gap Insurance
refers to the "gap" between what you owe on your auto
loan or lease and the current market value of your financed
motor vehicle. It is designed to pay the outstanding loan amount
or lease residual payoff on a financed motor vehicle should
you be involved in an accident and your vehicle is determined
to be a total loss.
- Your agent and insurance company
NW Insurance Council recommends talking with your agent or insurance
company representative about your insurance needs to accurately
determine the level of coverage that is appropriate for you.