Many people believe that once they purchase an auto insurance policy (or any insurance policy for that matter), they are completely covered. Are you one of those people? Sure, you have no problem being a responsible driver, which includes paying for another driver’s medical bills and property damage should you be at fault in an accident. But how much does your auto liability policy really cover?
Some drivers will buy a “minimum coverage” policy,” one which offers the minimum coverage required by the state of California. Currently, those minimum limits are 15/30/5, meaning $15,000 for injury/death to one person, $30,000 for injury/death to more than one person, and $5,000 for damage to property. Others may purchase a 10/20/3 policy through the California Low Cost Auto Insurance Program, which provides coverage up to $10,000 per person in case of bodily injury or death, up to $20,000 per accident in case of bodily injury or death, and up to $3,000 for property damage.
We are all aware of the cost of medical care these days, and even slight damage to the newer luxury cars ubiquitous to many areas in Southern California can easily run into the high four figure range. Do you believe $15,000 will cover the medical expenses of one person injured in an auto accident? What about the $5,000 property insurance coverage. How much would it cost to repair, say, a quarter panel dent or a paint scrub for a newer model automobile?
According to a report by Rocky Mountain Insurance Information Institute (www.rmiia.org). the average auto liability claim for bodily injury was $15,443. That means you would be on the hook for about $500 if there was only one injury. Two injuries with minimum coverage will take $1,000 out of your pocket. Remember this is an average. Our whiplash society is filled with people happy to exploit what they hope is a winning ticket in the lawsuit lotto.
As always, talk things over with your insurance professional to see that you have as much protection as possible.