Los Angeles, December 23, 2009 - In California, the minimally legal requirements for liability vehicle insurance are set at 15/30/5. That's $15,000 to cover the bodily damages of an individual, $30,000 for covering bodily damages in 2 or more people involved in the same accident - and $5000 for third-party property damages. Those requirements are set quite low. In many states, you will see numbers more like 25/50/25 and higher. And when you think about it, a major automotive accident can generate loads of damages - far more than your insurance company will be willing to pay out on policies of minimum liability. Guess where the remainder has to come from.
You guessed it - it comes from you. Even if it cost you:
- Your savings;
- Your stocks, bonds, CDs and more;
- Your personal property including your home;
So you see, simply maintaining the minimum requirements for liability insurance is not always your safest bet. In states like California where those limits are set very low, all motorists are encouraged to increase their coverage limits for their automotive insurance policies. As stated in the California Department of Insurance's consumer guide, “Since you may be personally responsible for damages above the policy limits, you should consider purchasing liability insurance with higher limits than the minimum required by law. With the increased costs of hospital stays, medical care, and car repair, it may be well worth considering the extra premium to purchase higher limits of coverage.”
Take the time necessary to be an effective comparison shopper. Utilize the powerful resources here at CheapAutosInsurance.com to find the best - and cheapest auto insurance available anywhere. Compare rates from different companies for different increased coverage limits. Remember that gaining knowledge about the automotive insurance industry in general will help you to save big money on your premiums in the long run.
Determining the amount of coverage that's best for you:
As a guideline for determining the amount of automobile insurance coverage that best suits your lifestyle and needs, consider the following: If you earn more than $75,000 per year, and own a home that's worth at least $150,000, then an intelligent liability limit of automobile insurance for you to maintain would be roughly 100/300/50. Of course, you will need to adjust these numbers according to your particular situation and needs. Just remember that all insurance is based on probabilities. Insurance is a game of chance. One thing is sure though: if you are involved in an accident, and it's your fault, you're going to be wishing that you had opted for the most coverage that you could afford.
