How Much Auto Insurance Coverage Do I Need?
As we all know it is the law that everyone who owns a vehicle in Pennsylvania must purchase Auto Insurance. The question becomes: “How much coverage do I need to purchase?” As with most legal questions the answer is not that simple.
Before purchasing Pennsylvania Auto Insurance everyone should think about, and answer these questions:
- What type of property, savings, retirement accounts and assets do I own that I need to protect in the event that I cause an accident and injure somebody or cause property damage?
- Do I want FULL coverage or LIMITED coverage?
- Do I want to protect the value of my car in the event of an accident? Do I want to purchase collision coverage?
- What if I am hit by an UNINSURED vehicle or a vehicle with little coverage (UNDERINSURED) and me or my loved ones are injured; do I need UNINSURED/UNDERINSURED motorist coverage.
- If I purchase UNINSURED/UNDERINSURED motorist coverage and I own more than one (1) vehicle, do I want to be able to STACK these coverages?
- How much MEDICAL bill coverage do I need?
- Do I need INCOME protection? AND
- What can I AFFORD?
Let’s answer these question one by one:
- Liability Insurance protects your assets in the case where you CAUSE an accident and someone is injured or property is damaged. You can be sued for the damages that you caused. To protect yourself and your assets your agent will recommend a certain amount of liability insurance based upon your status in life. In Pennsylvania every person needs to purchase liability coverage. The state minimum is $15,000/$30,000. If you have assets your agent will usually recommend policy limits of $100,000$300,000.
- Everyone should purchase FULL COVERAGE or in Pennsylvania what is called FULL TORT. You may be tempted to save a few dollars by purchasing LIMITED COVERAGE or LIMITED TORT, but we strongly recommend that you do NOT do so; history tells us that it is NOT worth it in the event that you or a loved one is injured in an accident.
- If your car is new or not too old, then you definitely want to purchase COLLISION coverage. If the Blue Book value of your old, trustworthy vehicle, is limited, then you may want to risk not having COLLISION coverage. Again, you are balancing the value of your car versus the cost of the coverage. Comprehensive coverage is generally recommended.
- At any given time there are thousands of UNINSURED vehicles on the roads in Pennsylvania. Additionally, many, many people purchase the state minimum insurance through carriers such as the General and Safe Auto. If you are hit by one of these drivers and are seriously injured you MUST protect yourself by purchasing UNINSURED/UNDERINSURED motorist coverage. In Pennsylvania your UNINSURED/UNDERINSURED policy limits must match your liability limits (i.e. $100,000/$300,000) unless YOU choose to lower the limits. Number one: ALWAYS PURCHASE uninsured/underinsured motorist coverage and number two: NEVER reduce the amounts of coverage to be lower than your liability limits.
- If you own more than one vehicles, your UNINSURED/UNDERINSURED motorist coverage is AUTOMATICALLY STACKED unless you WAIVE stacking. In other words if you are hit by an uninsured vehicle, suffer serious injury and have a $100,000/$300,000 policy limit and own two (2) cars, you automatically have protection for you and your loved ones of $200,000/600,000 in coverage. This can only be reduced if you sign a WAIVER of STACKING. Again, because this is the most important coverage, you should NEVER waive stacking.
- In Pennsylvania, everyone with Auto Insurance has a minimum $5000 in medical bill coverage. Once the $5000 is exhausted, your OWN private insurance (personal medical, employer supplied medical, Medicare, Medicaid, etc) is responsible. Depending on the type of personal medical coverage that you have, you may want to explore increasing your medical auto coverage. This increase can be expensive, so questions must be asked prior to increasing your premiums.
- Wage loss coverage is available as optional coverage in Pennsylvania. Most people who choose wage lose coverage have $5000 worth of coverage paying maximum benefits of $1000/month. As with medical coverage, the amount of wage loss coverage that you may want to purchase is dependent on your particular state in life. If you are retired or not working then wage loss coverage in not necessary.
- The bottom line is always the bottom line!! You should purchase the best coverage that you can reasonably afford. The above suggestions are merely that—suggestions. Protect you and your loved ones to the best of your ability.
Questions About Pennsylvania Auto Insurance Coverage?
Purchasing Auto Insurance in Pennsylvania can be a complex task. Everybody’s situation in life is different. If you have any questions about your AUTOMOBILE COVERAGE feel free to contact one the the attorneys at Dougherty Leventhal Price, LLP for a free consultation. They will be happy to answer any questions that you may have about your insurance. In the meantime, remember: Injury? Call DLP! (570) C-A-L-L-D-L-P