Archive for November, 2013

Nov 2013

Don’t Reduce Auto Insurance Coverage to Save Costs

Car insurance is expensive in California. In fact, CNN indicates that the average driver in the United States has seen their auto insurance premiums rise 23 percent in the past five years, even though inflation has risen only seven percent during this same time period. The average 40-year-old driver now pays between $1,510 and $2,700 per year for auto insurance, which can take a big chunk out of any family’s monthly budget.

Because of the high costs of auto insurance, some drivers are considering reducing their coverage limits or even dropping some types of auto insurance coverage altogether. While this can seem like a good idea at the time, it can get you into big trouble if an auto accident injury lawsuit is filed and if you are to blame for the crash. This is why CNN warns that drivers need to be very cautious about reducing their insurance coverage and need to truly understand the protections that they are giving up.

Insurance Coverage You Don’t Want to Cut

CNN highlights several key areas where you want to make sure you do not cut key coverage. These types of insurance coverage include:

  • Liability insurance coverage: Liability coverage pays for any legal fees you incur if you are accused of causing an accident, and also covers the amount of compensation that you are required to pay to other motorists to cover their medical bills, lost income, pain and suffering and other damages. Because a car accident can cause extensive injury and costly medical expenses and losses, you should usually have more than the state minimum of liability coverage. Experts recommend having $100,000 per person and $300,000 per incident of coverage. Having less means you could end up facing the loss of personal assets to pay car accident compensation if you cause a crash.
  • Uninsured and underinsured motorist coverage: This type of coverage protects you in case you become involved in a car accident and the at-fault driver has no insurance or has an insufficient amount of insurance coverage to pay for all of your losses. Without sufficient uninsured motorist coverage, you could incur hundreds-of-thousands of dollars in medical bills and have no real way to pay them. Suing an uninsured or underinsured driver personally is usually a losing battle because that driver may have limited assets or no assets to cover your losses – leaving you to try to foot the bill.
  • Repair coverage: Many insurance policies specify new factory parts only if a car is new. You can extend your coverage to ensure that you always have the ability to access the repair parts that will work best in your vehicle.

Car accidents cannot always be prevented, despite your best efforts to drive carefully. Insurance is supposed to protect you and it is very important that you don’t end up cutting costs in a way that puts your finances at risk.

If you’ve been injured, contact the Law Offices of Daniel C. Carlton at (949) 757-0707 today for your free case evaluation.