How Knowing Your State Insurance Laws Can Lower Your Car Insurance Quotes
One way to reduce a car insurance quote is to know state insurance law. This will allow you to minimize your coverage, resulting in lower rates.
Every state has its own minimum insurance laws in place. Most require a specific amount of bodily injury and personal injury protection coverage, in addition to property damage coverage. These amounts can range anywhere from $5,000 to $50,000 in some states, which means that insurance rates can vary significantly simply based on what the state chooses to mandate. In states with very low minimum requirements, however, many auto insurance companies will advertise car insurance quotes that include substantially more than the minimum required. Knowing the amount and types of coverage your state demands can help you save on your auto insurance premium.
After your auto insurance quote has been issued, do some research and find out what coverage levels your state mandates. This is usually as simple as visiting the state’s DMV website or calling a local registry for information. Be sure to find out what levels of bodily injury (BI) and personal injury protection (PIP) are required by law, as well as if underinsured motorist (UIM) and uninsured motorist coverage (UM) are required. BI and PIP will always be mandated in some form, but many states do not require drivers to carry UIM and UM, which protect against other drivers who do not have any insurance, or do not have enough. As well, find out if your state requires collision insurance, as this is typically built-in to auto insurance quotes but is not always necessary.
Once armed with the knowledge of what your state demands, call your provider and ask exactly what the quote they’ve issued you contains. If you find BI and PIP levels far higher than the state minimum, consider having them lowered. While this will reduce the payout in the event of an accident, it can also substantially lower up-front costs. Next, ask if any UIM or UI is present on the policy. If it is, but the state does not require it, it can be removed to reduce payments. Again, be careful when doing so, as many drivers carry too little insurance, and you could be stuck with a large bill, even if the accident is not your fault. Lastly, ask about collision. Almost every policy quote will come with this type of coverage built-in, but it can be removed in most states. On older model cars, especially, collision may not be worth the extra premium dollars.
Being knowledgeable about your state’s insurance requirements can help you get the best auto insurance quote for your money. If you choose, you can reduce all of the coverage on your policy to the bare minimum, increasing your monthly savings. Be aware, however, that this will come at the cost of lessened protection.