This post is part two of the blog post that answers the question “How much car insurance is enough?”
Compensation for Harm You Cause Others
At Vanyo Insurance Group, we’ve seen our fair share of serious accidents. When they involve other victims besides the at-fault driver, the costs can quickly spiral out of control. At-fault drivers are financially responsible for the injuries they cause, as well as any other losses resulting from those injuries. If you are completely or partially at-fault for a collision, you could be sued for medical bills, emotional distress, rehabilitative costs, and lost income due to disability. Furthermore, a jury could impose punitive damages on you – especially if you exhibited gross negligence or were found to be intoxicated or texting at the time of the accident.
Here in Arizona, all drivers are required to purchase car insurance that includes a minimum amount of bodily injury liability protection. However, the minimum limits are far too low to provide any significant protection in the event of a serious collision. Considering you are still financially responsible for any damages that exceed the limits on your policy, we recommend Scottsdale area drivers to purchase much more than the minimum coverage necessary. Without adequate limits, nearly everything you have – your savings, investments, and income – could be at risk of liquidation or seizure.
Split Limits vs. Combined Single Limit (CSL)
Insurance companies offer two different types of bodily injury liability limits. Some feature split limits, which are two different numbers that represent in thousands the amount of money an insurer will pay toward the cost of injuries per individual and per accident. In other words, a 15/30 split provides up to $15,000 of coverage per injured individual and up to $30,000 total available bodily injury liability protection for all injured victims in an accident. A combined single limit, or CSL, is less restrictive, instead offering a single coverage limit with no caps on individual limits. In other words, a 300 CSL on your policy would provide $300,000 in total bodily injury liability coverage to be divided among victims without limitation.
Money to Protect You and Your Passengers against Uninsured or Underinsured Drivers
Car insurance should work to protect you and your passengers. Perhaps the most important coverage you can purchase is that which shields you against the negligence of others and assures you have access to the medical care you need – even if an at-fault driver is uninsured or does not have enough insurance to pay for it. Uninsured motorist protection covers injuries to you and your passengers when you are hit by a driver that has no bodily injury liability protection. Another important protection – underinsured motorist protection – fills in the gaps when the cost of your injuries exceeds the liability limits on the at-fault driver’s policy.
Money to Help with the Smaller Things
How much is your health insurance deductible? If you are injured in an accident, having a few thousand dollars can provide major financial relief while you seek medical care. Medical payments coverage compensates you for your injuries in an accident, regardless of who is at-fault. It is just one way you can reduce your financial burden after an accident by getting insurance for the ‘small things.’ From rental car reimbursement to tow truck charges, we here at Vanyo Insurance can help you assemble the right types of coverage to minimize your losses after a collision or other covered event.
Beyond Car Insurance
If you cause a car accident that results in major injuries or loss, even the highest liability limits might not be enough to cover the damages. Umbrella insurance can extend your liability protection with supplemental coverage that picks up where your primary coverage leaves off. In other words, if you are sued for $750,000 and only have $500,000 in liability coverage, you can look to your umbrella policy to pay the excess damages that exceed your car insurance limits. Umbrella insurance is very affordable and typically provides $1 million or more in supplemental liability protection. We recommend that all drivers consider adding this important coverage to their insurance portfolios.