Here’s Why State Minimum Coverage Is Not Enough

As a responsible vehicle owner, you’re likely aware of the importance of auto insurance and state minimum coverage.

These policies can fulfill an essential role as you seek to manage your finances and maintain fiscal stability. Furthermore, they may often be required by law.

However, while most states impose legal mandates regarding auto insurance, you should avoid the pitfall of assuming that satisfying such obligations automatically means you’re adequately covered.

In many cases, you should strongly consider purchasing additional coverage.

Understanding Auto State Minimum Coverage Needs

You should first understand what parts of auto insurance may be legally required for you. Most states, such as Texas, require drivers to have proof of financial responsibility.

Generally, this mandates carrying third-party liability coverage to ensure other parties can recoup losses for which you’re at fault. Additionally, other states may require additional financial protections, such as personal injury protection and uninsured/underinsured motorist coverage.

In some cases, you may also be subject to additional insurance-related requirements.

For example, if you financed your vehicle when purchasing it, your lender will likely require you to maintain additional types of insurance, such as collision coverage and comprehensive coverage, until you’ve paid off your loan.

Why Is Additional Coverage Needed?

Even if you own your vehicle outright or are otherwise free of additional insurance-related requirements, maintaining coverage beyond legal mandates is highly recommended.

Consider how additional features may assist in situations that might otherwise incur catastrophic out-of-pocket losses:

• If you’re at fault for a car crash, liability coverage may help pay for other parties’ losses, but paying for your own vehicle’s repairs might require collision coverage.

• If someone steals or vandalizes your vehicle, comprehensive coverage can be crucial in compensating you. Otherwise, you might need to pay for repairs or a new vehicle out of pocket.

• If you’re injured in an accident for which you’re at fault, medical payments coverage can assist with health care expenses.

• If another party is at fault for an accident but does not have sufficient coverage to pay for your losses, uninsured/underinsured motorist coverage can ensure you can fully recoup them.

Get the Right Coverage

Contact Licona Insurance Group today to learn more about auto insurance or get a free quote.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.