State Minimum Auto Coverage: Worth It?
As consumers, we’re always looking for the best deals, but often times as you know, the cheapest product is rarely the best product. Every state has a set liability limit on auto insurance that every driver must carry at a minimum. People carrying minimum state coverage are definitely the ones you want to avoid getting into an accident with if it were possible to do.
State Minimum Insurance in Arizona:
• Bodily injury liability coverage: $25,000 per person / $50,000 per accident
• Property damage liability coverage: minimum $15,000
• Uninsured motorist bodily injury coverage: $25,000 per person / $50,000 per accident
• Underinsured motorist bodily injury coverage: $25,000 per person / $50,000 per accident
Here’s an Accident Scenario with You Carrying State Minimum Insurance:
You hit a new F-150 head on and do $25,000 worth of damage to their truck and injure 3 people inside causing $80,000 dollars in medical bills. Your own vehicle is totaled and medical bills for a neck injury of your own are $7,000.
What Will State Minimum Cover in This Scenario?
• $15,000 to fix the F-150 truck
• $50,000 to cover medical bills for the 3 injured people
This leaves you owing a balance of $40,000 to the not-at-fault party ($10,000 in property damage and $30,000 in bodily injury costs). They may seek compensation from you for this money.
You’re left owing thousands of dollars to someone else, you still have $7,000 in your own medical bills racked up and you’re without a car now (if you don’t have collision and med pay coverage, both of which are not required by law). Now, you have to take a bus, Uber, or bicycle to work while trying to save up enough money to get a new car, pay off your bills, and potentially deal with a lawsuit. Things are not looking too good for you, all because you thought you could save a couple bucks by opting for state minimum coverage.
Other Downsides to State Minimum Insurance Without an Accident:
• Places that offer it usually require a steep down payment and other fees
• Often times it’s renewed on a month-to-month basis, meaning you can’t lock in your rate, which is especially bad if you get into an accident because your rate could increase right away.
What’s an Affordable Alternative for State Minimum Insurance?
There are numerous insurance companies that will provide you with affordable rates and great coverages. Shopping with a broker is one of the best ways to quickly compare rates and benefits without doing all the work yourself. Call your insurance broker today to get better coverage than state minimum at a price you can afford.
Contact AZ Insurance Team
If you have questions about your auto insurance coverage or would like to review your policy, contact the experienced team at AZ Insurance Team. We're happy to help you understand your options and find coverage that fits your needs and budget.
Phone: 480-535-5709
Comments