Auto insurance claims are expensive. No matter what type of accident occurs, you may need to file a claim just to have the damage properly repaired. Yet, many people do not update their car insurance coverage value often enough. You may find yourself unaware that your existing policy just is insufficient. What do you do then? It’s important to know how much car insurance you should have. Here’s how to do that.
Know The Risks
According to the Insurance Information Institute, the average auto insurance claim in the U.S. was $935.80 in 2018. That includes damage from minor fender benders. That value is likely to fall under most car insurance coverage limits. Yet, many times, an accident can cost you more to recoup.
Consider this situation: You are in a car accident with another driver. The damage to your vehicle is $15,000, due to a bent frame and significant body damage. The damage to the other driver’s car is also high. There is also the cost of medical bills. There is time lost at work. And, if it goes to court, there can be pain and suffering claims.
It all adds up quickly.
What Happens If You Do Not Have Enough Coverage?
Some people purchase a very low level of coverage for their auto insurance policies. Having a low value like this saves you money on premiums.
Yet, when an accident occurs, it leads to significant out-of-pocket costs. That is because you remain responsible for those losses. You have to pay for the costs to repair your vehicle. You also have to pay for the costs the other party incurred as a result of the incident (if you caused it to occur).
Whether or not your auto insurance coverage runs out, other drivers with losses can still file a claim against you. They can also take you to court. In some cases, the court may rule that you have to pay the damages. This can become complex.
What Is the Solution?
Speak to your Auto Insurance Discounters representative today. Discuss the amount of coverage you have right now. Discuss what the average claims are in your area. It also helps to know what the worst claims in your area are for vehicles like your own.
Increasing your coverage may not cost much. Yet, it can provide peace of mind if there is an accident that causes significant loss like this.