Understanding Car insurance – What you need to know 101

You got the keys you ready to go let’s drive oh wait do we have insurance? how do I buy car insurance?

if you’re new to driving car or if you just don’t understand insurance this article is going to help you. I’m an insurance agent license in 38 plus States I think it’s like flood 4045. So, I don’t know if you’re new to insurance or if you’re curious on the way that the coverage’s work.

So, I just want to go over like the different types of coverage’s. If you’ve got somebody new to insurance they should definitely look at this. Now keep in mind this is generalization I can’t give you exact numbers because I don’t know what state you’re in. So, if you’re in Michigan there’s a lot more stuff versus the person that’s in New York versus the person that’s in Florida but I’ll give you some of the bases and I’ll go over some of the states that are very popular.

Florida State Car Insurance:

So, I’ll probably go through Florida because they’re a huge state for an insurance maybe California some things like that and you’re looking at insurance. I’ll start off with auto insurance the first thing that you want to do is they’re going to ask you:

  1. What’s your bodily injury like?
  2. What kind of coverages are you looking for here’s?
  3. How you determine what coverages you need?

So, you want to look at your income the money coming in and you want to look at your assets your vehicle.

Do you own a house the way you want insurance to look is you want car insurance to look better than you if your income levels here you want your coverages to be? Just here that way if something happens because you can’t control it. You get an accident it might be your fault you know you dropped a pen you want to go grab it or you looked away. You hit somebody they’re going to sue you if you don’t have enough coverage’s and if they take a look at you when they go to court they say okay well this guy’s making this much but as insurance has this much. So, forget this guy we’re just going to go after the car insurance company and that’s really the main design of car insurance that’s basically the way you want to have it set up.

Your first set of coverage is called bodily injury RBI limits they call them. So, what type of BI limits if you’re brand new young driver a lot of people here they’ll say I want the state minimums so typically the lowest one. That I know of is Florida where they offer it’s called 1020 that means if you injure somebody in a car accident it will pay $10,000 per person in that car up to a total of $20,000 so if you hit a car there’s three people in it. Just assume each of them have $5,000 worth of medical claims you’re covered because you have 5 10 15 so, you haven’t maxed it out and you haven’t gone above 10 per person.  

Typically, what most people will do if you have a lower income just about every state I know offers twenty-five and fifty it doesn’t cost much more to up it to the twenty-five fifty and it’s not a lot of coverage but it’s at least enough. Where if you don’t have a large income or you don’t have a lot of assets that it’s a good starting place.  So, that’s your bodily injury limits.

The next thing is called PD that stands for property damage anything that you damage if you run into a house, if you run into another car that’s covering the vehicle.

Most state minimums they’ll let you do $5,000 that’s just to pay repairs not for you for anyone you hit that’s really low because most cars nowadays the paint jobs are $5,000. I always think about it is pretend you hit not necessarily a Mercedes or Ferrari but pretend you hit a decent BMW. Most BMWs I would expect to be about 45 to 50 thousand dollars even if they’re used so recommendation do at least fifty thousand the next level above that would be a hundred thousand. But they you can do lower than that keep in mind property damage is the cheapest thing to buy. Car insurance so upping that coverage will cost you dollars. So, don’t try to save a couple dollars because it could cost you a lot more in the end. So, as far as that you got 5 10 15 20 25 you know you can and you can go as high as you want after that.