What insurance do I need for my car?
Finding the type of insurance you need for your car will depend on the value of your vehicle, your personal risk tolerance, and the insurance laws of the state you live in. You will likely need at least minimum limit liability to legally drive, but we recommend higher limits so you aren’t paying out of pocket for an accident. Start shopping for the auto insurance you need for your car with our free comparison tool below.
Free Insurance Comparison
Compare Quotes From Top Companies and Save
Secured with SHA-256 Encryption
UPDATED: Jan 21, 2021
It’s all about you. We want to help you make the right coverage choices.
Advertiser Disclosure: We strive to help you make confident insurance decisions. Comparison shopping should be easy. We are not affiliated with any one insurance provider and cannot guarantee quotes from any single provider. Our insurance industry partnerships don’t influence our content. Our opinions are our own. To compare quotes from many different companies please enter your ZIP code on this page to use the free quote tool. The more quotes you compare, the more chances to save.
Editorial Guidelines: We are a free online resource for anyone interested in learning more about life insurance. Our goal is to be an objective, third-party resource for everything life insurance related. We update our site regularly, and all content is reviewed by life insurance experts.
Insurance Q&A: “What insurance do I need for my car?”
When it comes to car insurance, there are seemingly endless coverage options available to us.
Depending on your personal financial situation, the value of your vehicle and your personal risk tolerance, you may decide to purchase all or only a few types of coverage.
Remember, most states have mandatory minimum auto insurance laws that come with the ownership and operation of a motor vehicle.
Let’s look at a few examples of what type of coverage and liability limits you may need, based on your unique situation.
I’m Broke and My Car is a Junker
If this statement represents your current situation, you will likely opt to purchase state minimum liability car insurance coverage and forego physical damage coverage, including comprehensive and collision, for your jalopy. It doesn’t make sense to pay for coverage to repair or replace a car that isn’t worth anything.
Read more about the difference between comprehensive and collision coverage.
I’m the Average Joe in the Average Car
You will likely need at least minimum limit liability, but should certainly opt for higher limits if you can fit it into your budget. Remember, there is no limit on how much you can be sued for if you cause an accident and lose a resulting court case. You are on the hook for any amount of money over what your insurance company insures you for. We are talking wage garnishment here people!
Also, the average American is leasing or has an existing loan on their car. If this is the case, you lender will require you to purchase physical damage coverage on the vehicle to protect their financial interest. The lender is considered a loss payee on you policy, which means any money you owe on a totaled car is first paid to the insurer and you get what’s left.
I’m Wealthy and My Car is a Status Symbol
Think full coverage. And a much higher insurance premium. You will certainly want to opt for higher liability limits on your auto policy if you have “something to lose,” from a financial standpoint. If you have money and cause someone bodily injury or property damage, you can expect an attorney to find your money…and take it.
Physical damage coverage is almost always mandatory in this situation, unless you own your Porsche outright and don’t have to protect a lender’s interest in your chariot. Even still, a financially savvy individual should understand it is better to pay a few hundred extra dollars per year and leave your insurer on the hook for any damages you may be found liable for.
Get insurance quotes online or talk to a local independent insurance agent if you need assistance choosing the right coverage or simply want to be sure you get the best deal no matter what your insurance needs.