Car insurance laws in the United States help protect individuals involved in accidents that aren’t their fault by being mandatory in almost every state. These ensure that every driver who may cause an accident has insurance that covers a minimum level of costs for injuries or property damage. In this manner, state-mandated car insurance ensures drivers are accountable for the risk that comes along with driving a vehicle.
Whether you’re skeptical of your insurance policy or curious about why it’s necessary, it’s beneficial to know what you’re paying for. Car insurance is a good investment because it protects you and your assets.
Why Do You Need Car Insurance?
The Law Suggests It
Most states mandate car insurance. 49 of America’s 50 states require drivers to have an active car insurance policy. New Hampshire is the only state where you don’t need to have it if you can prove financial responsibility.
Helps Avoid Huge Expenses in the Future
Car insurance can protect you and your family from unexpected costs. You can help avoid future costs by investing a tiny portion now in your own protection. Collision insurance, comprehensive insurance, property damage liability, and bodily injury liability can help to cover costly claims in an accident.
Protects Yourself and Others
If you cause an accident, you may be held liable for the costs involved. These may include legal fees, medical expenses, or lost income if the injured person cannot work due to their injuries. Liability coverage may cover these expenses. You would most likely have to pay these costs out of your pocket if you did not have coverage or adequate liability limits.
In an uninsured situation, the other driver and passenger could sue you for 100% of their medical costs, loss of use, vehicle damage, and other damages.
For Health Coverage
If you are injured in an accident, medical payment coverage and personal injury protection may help pay your medical costs. It may also assist in covering your passengers’ expenses as a result of the accident. This coverage may cover hospital stays, doctor bills, and surgery costs.
Car insurance may be able to help you pay for medical expenses that your health insurance does not typically cover. A good car policy can assist in covering costs like dental work and medical treatments required after an accident.
Lender Requirements
If you financed or leased your vehicle, your lender will almost certainly require more coverage than your state. Because the lender legally owns the vehicle, it must be financially protected in case of a collision or other damage.
Your lender may require you to purchase collision and comprehensive coverage. These two coverages may help protect the lender or leasing agent’s investment in your car while you’re making payments. If your car is damaged in a covered loss, comprehensive or collision coverage may pay to repair or replace it.
Conclusion
Getting complete car insurance coverage can go beyond meeting a legal requirement. A car insurance policy can protect your vehicle, wallet, and family and give you peace of mind. Everyone makes errors. Sometimes, another driver’s mistake can become your problem. With the right car insurance, you can relax knowing you are protected if an uninsured or underinsured driver hits you.
