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How much auto insurance do i need?

The answer to this question isn’t cut and dry. We understand that everyone wants to save money.  With tight budgets, the amount you pay for insurance is certainly of concern, but you also need to be careful that in trying to save money now...you don't put yourself at financial risk should something happen. How much insurance is right for you really depends on your individual situation, and we can help you determine what feels right based on your needs and budget.

When deciding how much insurance you need, answering following three questions can be helpful.

1) What liability coverage limits will be enough to protect me?

It’s impossible to predict exactly how much you would have to pay if you found responsible for an accident because there are too many variables involved in any situation. While there isn’t a set formula, it can be helpful to consider how you would pay for any damages that exceed your coverage limits. Even “minor” accidents can cause costly property damage not to mention the sky rocketing costs of medical care or other possible other monetary damages should you injure someone. When deciding your limits, you want to think about how much you would need for a worst case scenario not an "average" accident because it only takes one catastrophe to change your life. The higher your liability coverage limits, the more likely your policy will be able to pay all of the damages and protect you financially.  You don't want to risk a lot for a little.

2) What collision and comprehensive deductibles can I afford?

Higher deductibles lower your premium but increase the amount you must pay out of your own pocket if a loss occurs. Determine how much you would be willing AND able to pay on short notice in order to save on your premium. It may make sense to have a higher deductible and use those “savings” to purchase higher protection limits on other parts of your policy that cover liability.  Again, you want to think about getting coverage that will cover you in a catastrophe.

3) Should I carry collision and comprehensive coverage?

If you have a loan on your vehicle or lease it, you might have to carry collision and comprehensive. If you own your car free and clear, you might consider dropping these coverages to save money as the value of your car decreases. However, you need to decide if the risk of having to pay the entire cost of repairing or replacing your car is worth the savings in premium. 

Let our associates walk you through your options. Contact us to have a conversation about your protection plan.

NOTE: This information is only a general description of the available coverages and is not a statement of contract. All coverages are subject to all policy provisions and applicable endorsements. Some coverage may be subject to individual insureds meeting underwriting qualifications and to availability within a state. For further information contact a Murphy Insurance Agency Associate.